The New Fiscal Trilemma: The Mass Politics of Public Debt, Immigration, and Austerity

Reducing public debt, avoiding austerity, and limiting immigration create a “fiscal trilemma” in the context of ageing populations and limited avenues of growth. Yet, European voters display an aversion to both austerity and immigration. In this paper, we probe how the Italian public responds to this impending constraint and test if citizens prefer austerity to immigration or are willing to relax opposition to immigration to avoid the material consequences of austerity. Our first experiment reveals that information about immigration’s fiscal benefits increases support for pro-immigration policies and improves attitudes toward immigrants. Next, using a conjoint design, we show that citizens prefer parties that reduce debt through immigration rather than austerity. These findings suggest voters prioritise material interests over sociocultural concerns when confronted with this trilemma. The results provide insights into the interaction between fiscal policy, immigration, and austerity, with significant implications for policymakers navigating Europe’s economic and demographic challenges.