As has been emphasized by Feld and Kirchgässner (2000), political outcomes are closer to citizens preferences in direct democracy compared to representative democracy. Since voting rights are a central part of the Swiss democratic life11 - thus by far dominating other countries with respect to the frequency of use12 -, relying on a median voter framework may help us to get some useful insights on the shaping of public policies. Keeping in mind this point of view, how has direct democracy contributed to the shaping of Switzerlands immigration policy over the last fty years?13
During the period of strong growth in the early post-war period, labor shortages in Switzerland were met by immigration, with the foreigners share in the population increasing from 5:8% to 9:1% between 1950 and 1960 (see gure 2-1). But at the beginning of the sixties, tensions started building up and the government decreed two federal orders - in 1963 and 1964 - aiming at limiting the inow of migrants.
In 1965, the rst popular initiative attempting to limit the number of foreigners to 10% of total population - instead of the prevailing 15% - was introduced. Confronted with this threat, in 1968, the government decreed a new federal order aiming at stabilizing the stock of foreigners while at the same time making it easier for foreigners children to become naturalized and giving leeway on exemptions to assuage economic interests. The initiative was withdrawn but, as the number of foreigners with renewable or long-term permits actually increased by close to 5%, instead of falling by 3% as announced in the Federal decree of 1968, a second initiative asking to limit the foreigners share to10%of the population was introduced in 1969. Since this time the instigators gave up the possibility of withdrawing the initiative, the rst vote on immigration policy in Switzerland took place in 1970.
1 1See Linder (1994) for an overview of the Swiss political system and of the critical role played by voting rights.
1 2Swiss citizens called to the booths - on average - four times per year.
1 3This section draws and expands on de Melo et al. (2003). Appendix III provides an overview of all the votes on initiatives and referenda which took place in Switzerland since the end of World War II.
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The vote of June 7, 1970 marks a watershed in Switzerlands policy towards immigrants.
It was the rst of a series of popular initiatives taken to the polls over the next thirty years, and the beginning of a policy based on a complex system of yearly quotas that is still applied today. This vote also registered one of the highest participation rates14 - 75% - and was only narrowly rejected in spite of a last ditch e¤ort by the government to bring consensus around its immigration policy by introducing further restrictions.
In reaction to this rst vote on immigration policy and squeezed between economic in-terests and popular pressures, the Swiss government started to devise a complex system of quotas. This system was designed to give it the exibility to play both sides and to adjust rapidly to short-term objectives resulting from the combined pressures coming from labor unions wishing binding quotas, rms wishing loose quotas, and parts of the public wishing to preserve cultural identity as expressed in its xenophobic requests. For example, family reuni cation was not included in the quotas, nor was the transformation of seasonal to annual permits. Nevertheless, this loophole led to a third popular initiative seeking to restrain immigration. With a high participation rate, the initiatives rejection on Octo-ber 20, 1974 by a 2=3 majority heralded the success of the governments give and take
approach.
The role of the democratic process was also evident in the 1981 vote on a popular initiative aiming at creating more equality between Swiss nationals and foreigners, and eliminating the seasonal workers status. This proposal to abolish the seasonal workers status was sharply opposed by the construction, catering, and agriculture sectors that rely heavily on this category of labor and it was clearly rejected by the electorate. Nevertheless, since by that time the foreign population was e¤ectively stabilized and the proportion of annual permits had fallen from 70%in 1970 to25% in 1980, exibility in migratory policy had already substantially waned.
It is only in the late eighties with the surge in asylum seekers and the prospects of a closer relationship with the EU that immigration policy started again to be questioned.
On the one hand, distinguishing between economic and political immigration motives was becoming di¢cult, and, on the other hand, the guest-worker system appeared inappropriate if closer ties with the EU were to develop. Sensing that the vote on the EEA act would be rejected because it would call for an abolishment of the guest-worker system, an immigration policy based on cultural proximity - often referred to as the three-circle policy15 - was adopted by the government. In 1992, the referendum to join the EEA was nevertheless rejected by Swiss citizens.
The introduction of the three-circle policy was rapidly the subject of much criticism both within Switzerland from the business sector against the quota system and from the anti-immigrant citizens on the weakness of the discriminatory cultural proximity policy,
1 4Note that the right to vote for women was only introduced in 1971.
1 5Under the three-circle system, work permits were granted preferentially to citizens of EU and EFTA countries, then to citizens of certain other countries considered to be traditional migration partners of Switzerland, and nally to citizens from the rest of the world.
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Figure 2-1: Foreigners share and migration policy in Switzerland, OFS data
and abroad by criticisms against the stigmatizing and discriminatory e¤ects of this policy during the International Convention against racism in 1995. Hence, in 1998, a proposal of a point system akin to the one in use in Canada and Australia was discussed by the Swiss authorities. Although this proposal did not carry the day, the government shifted to a
two-circle policy to accommodate the desire for closer ties with the EU - with67%of the electorate accepting the bilateral agreements16 with the EU in May 2000 - while catering to anti-foreigner feelings in the population. Meanwhile, guest-worker permits were cut in half to880000 during the decade of the nineties.
Since June 1st, 2002, the conditions for admitting immigrants from EU countries has been regulated by bilateral agreements which insure a smooth transition to free mobility of persons between these two areas. In September 2005, Swiss citizens had to vote on the extension of the free mobility agreement to the ten new EU member states. The issue of that vote was uncertain until the o¢cial results were published, but, once again, the safeguard clauses negotiated by the Swiss government helped to insure a positive outcome.
For the citizens outside EU, their admission to Switzerland is actually governed by a new foreignerss law which is based on a strict point system.
As highlighted by the preceding description, the Swiss direct-democracy system has had a very important impact on the shaping of Swiss immigration policy. Indeed, the system of popular initiatives - some aiming at controlling the ow of immigrants, others at
1 6Among the bilateral agreements there was the free mobility of labor between Switzerland and EU15 countries.
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improving the status of immigrants - forced the government to compromise and to design over the years an e¤ective, though not economically e¢cient, immigration policy. Moreover, minorities opinions have often been taken into account in the political process in order to avoid opposition through the voting booths. Combined with the fact that the foreigners
share in population has always been one of the highest in Europe and half of the new immigrants are entering Switzerland for labor purposes, Switzerland seems to be a good country for analyzing the political and economic stakes at an individual level.