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An Economic Analysis of the European Refugee Crisis: Labour Market Integration, Effects on Crime, and Attitudes

16th National Competition for Economic Research Grants

Public economics

Senior Researcher : Luigi Minale

Research Centre or Institution : Departamento de Economía, Universidad Carlos III de Madrid

Abstrac

The project analyses the labour market integration of refugees in Europe using, among others, micro-data covering refugees residing in 19 European countries who have arrived between 1985 and 2013.

In the first part, the project documents how refugees struggle to integrate into the receiving labour market, by comparing their performances with those of non-refugee migrants. The analysis firstly shows that even after controlling for observed and unobserved determinants of labour market success, refugees show weaker labour market performances than non-refugee migrants: are less likely to be employed (by 12%), more likely to be unemployed (by 22%) and much more likely to be in the bottom decile of the income distribution. The refugee gap with respect to other migrants is persistent over time, approaching zero only after 10-15 years of residence in the host country, and substantially heterogeneous across both destinations and sending countries.

In the second part, the project analyses the impact on refugees’ labour outcomes of two refugee- specific policies: dispersal policies and employment bans.  The econometric analysis is based on combining micro-data with newly collected information on the implementation of those policies from 1985 onward, and employs a Differences-in-Differences framework. Dispersal Policies seem to worsen the performance of refugees with the negative effects due, in part, to the initial sub- optimal allocation throughout the national territory induced by the policy. Temporary employment bans are often imposed to recently arrived asylum seekers, that is, a period during which they are not allowed to take up legal employment. The analysis suggests that: i) being exposed to an employment ban at arrival reduces refugees’ employment probability and labour market participation in the medium-run; ii) the negative impact on employment primarily comes from reduced participation; iii) the detrimental effects are highly persistent over time; iv) the impact of employment bans derives primarily from the presence of the ban itself (extensive margin) rather than its length.

 

Scientific Production
 
Magazine Articles 1
Communications at national conferences 3
Communications at international conferences 13

 

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