Business Insider thinks that Europe's inflow of migrants is good news for the economy
Source: uk.businessinsider.com
The European refugee crisis has sparked fierce debate over whether to admit asylum seekers from Syria and Iraq on cultural and safety grounds.
But according to Credit Suisse, it makes economic sense to let them in.
In a note to clients on Monday, Christel Aranda-Hassel, Peter Foley, and Sonali Punhani at Credit Suisse say that the inflow of refugees and migrants will be positive for Europe's economic outlook both in the short- and long-term.
"In the short term, it should add to economic growth," says the note. "The multiplier of public outlays required to house, feed and otherwise provide for asylum seekers is roughly equal to one. Fiscal expenditure could thus add 0.2pp-0.3pp to [euro area] GDP growth next year."
The multiplier is good news as that money would go directly back into the economy instead of the savings accounts of consumers and businesses.
"[A]ll money spent on migrant's basic necessities is likely to fully find its way back into the economy."
Credit SuisseEuropean Commission estimates without migrant population and Credit Suisse estimates with migrant population.
Additionally, the analysts point to an OECD report that migrants will contribute more in taxes and social benefits than they will receive.
The bigger contribution, however, is in the long-run impact on the labor market of the continent.
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