Comparing Public Transfers between Immigrants and Natives: A National Transfer Accounts Approach

In Canada, immigration constitutes the primary response to population ageing. While extensive research covers the impact of immigration on various aspects of the labour supply, its fiscal impact has received less attention. In this study, we apply the National Transfer Account (NTA) method and Demographic Decomposition to estimate the net fiscal cost of immigration in Canada between 1997 and 2015. Results show that on a per capita basis between 1997 and 2015, immigrants received about $1710$ more than natives in Net transfer. Moreover, accounting for the difference in age structure between the two populations not only increases the Net Surplus of immigrants to $3640 but also reveals the labour market imbalances as the source of 85% of the surplus.