Does immigration weaken natives' support for the unemployed? Evidence from Germany

Using data from the 1997 and 2002 waves of the German Socio-Economic Panel and from official statistics, I study whether natives are less supportive of state help for the unemployed in regions where the share of foreigners among the unemployed is high. Unlike previous studies, I use individual-level panel data, which allows a more convincing identification of a causal effect. I find that the negative bivariate association is mainly driven by observed individual differences, such as East German origin or income. While there remains some evidence of a negative association even after adjusting for observed and unobserved individual differences, the association is relatively weak.