The way in which these effects play out will obviously depend on the nature of
economic and political institutions. For example, in theoretical treatments of the
political economy of immigration and pension provision, it matters what is assumed
about rules governing pension rights. Assuming public pension benefits are fixed and
immigration, therefore, eases the tax payments on younger generations required to
finance them leads to the conclusion that immigration is likely to be favoured by the
young but not the old (Scholten and Thum, 1996); assuming that contributions are
fixed and immigration therefore increases pensions instead leads to the opposite
conclusion that immigration will tend to be favoured by the old rather than the young
(Razin and Sadka, 2000; Kemnitz, 2003). Leers et al. (2003) allow both taxes and
pensions to respond to population change. Since population growth means that the
young outnumber the old, differing assumptions can lead to seemingly inconsistent
conclusions about the consequences for immigration policy, as, for example, Haupt
and Peters (1998) point out in an analysis that explores both types of model. Krieger
(2003) explores the potential for differences in conclusions depending upon whether
pension benefits are assumed to be flat (Beveridgean) or earlier-income-related
(Bismarckian) though he finds this to be less important.