Conflict-Induced Displacement and Labour Market Outcomes: Evidence from Post-War Bosnia and Herzegovina

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Conflict-Induced Displacement and Labour Market Outcomes: Evidence from Post-War Bosnia and Herzegovina

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Florence Kondylis

Abstract

This study uses a longitudinal data source to study the effects of conflict-induced displacement onlabour market outcomes for Bosnians in post-war Bosnia and Herzegovina. To account forendogeneity in the displacement status, I exploit the fact that the level of violence in the pre-warresidence likely affected the displacement decision for Bosnians and yet is not associated to economicperformance. I find evidence of positive selection into displacement, i.e. more "able" individuals interms of labour market outcomes are more likely to be displaced, and that displaced Bosnians menand women are less likely to be in work relative to stayers. Interestingly, whereas this translates intohigher unemployment for men, it decreases women's participation with no effect on unemploymentonce selection is accounted for. The informality of the labour market in BiH and the destruction ofnetworks are not only the most plausible candidates to explain the high cost of displacement in termsof labour market outcomes, but they also help rationalise the lack of an effect on participation fordisplaced men. However, differences in selection suggest that the experience of war was highlycontrasted along gender lines and that sociological and cultural factors may also play a significantrole.

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Paper provided by Centre for Economic Performance, LSE in its series CEP Discussion Papers with number dp0777.

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Date of creation: Nov 2007
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Find related papers by JEL classification:
C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data
C81 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Microeconomic Data
J60 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - General
O15 - Economic Development, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
R23 - Urban, Rural, and Regional Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

This paper has been announced in the following NEP Reports:

NEP-ALL-2007-03-31 (All new papers)
NEP-LAB-2007-03-31 (Labour Economics)

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Markus Jäntti & Matti Sarvimäki & Roope Uusitalo, 2009. "Long-Term Effects of Forced Migration," SERC Discussion Papers 0015, Spatial Economics Research Centre, LSE. [Downloadable!]
Other versions:
- Sarvimäki, Matti & Uusitalo, Roope & Jäntti, Markus, 2009. "Long-Term Effects of Forced Migration," IZA Discussion Papers 4003, Institute for the Study of Labor (IZA). [Downloadable!]

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