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Macroeconomic impacts of refugee inflows in OECD countries: A panel data analysis

Author

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  • Mustafa Batuhan TUFANER
  • Ä°lyas SÖZEN

    (Turkey)

Abstract

The increase in refugee inflows due to war and violence in the world has revealed the necessity of dealing refugee inflows internationally. The aim of the study is to investigate the impact of refugee inflows on host economies. In this study, 36 OECD countries were analyzed with panel data method for the period 1993-2017. In the model, the number of refugees is independent; economic growth, inflation and government expenditures are dependent variables. In the first stage of the analysis, panel unit root tests were applied to test the stationary of the variables. Then, Gengenbach, Urbain and Westerlund panel cointegration tests were performed to test the cointegration relationship between the variables. To estimate the long-term relationships between variables, the Dynamic Ordinary Least Squares Mean Group (DOLSMG) estimator was used and a negative relationship was found between refugee inflows and economic growth, while a positive correlation was found between refugee inflows and inflation, also between refugee inflows and government expenditures. Finally, the Dumitrescu-Hurlin panel Granger causality test was used to estimate the causality relationship between the variables. According to the causality test results, while there was no causality relationship between refugee inflows and economic growth, a mutual causality relationship was found between refugee inflows and government expenditures. However, it has been observed that unidirectional Granger causality running from refugee inflows to inflation.

Suggested Citation

  • Mustafa Batuhan TUFANER & Ä°lyas SÖZEN, 2019. "Macroeconomic impacts of refugee inflows in OECD countries: A panel data analysis," Journal of Economics Library, EconSciences Journals, vol. 6(3), pages 186-200, September.
    • Handle: RePEc:cvv:journ5:v:6:y:2019:i:3:p:186-200
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    References listed on IDEAS

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    1. Hatton, Timothy J., 2012. "Refugee and Asylum Migration to the OECD: A Short Overview," IZA Discussion Papers 7004, IZA Network @ LISER.
    2. Jack A. Goldstone & Robert H. Bates & David L. Epstein & Ted Robert Gurr & Michael B. Lustik & Monty G. Marshall & Jay Ulfelder & Mark Woodward, 2010. "A Global Model for Forecasting Political Instability," American Journal of Political Science, John Wiley & Sons, vol. 54(1), pages 190-208, January.
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    Keywords

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    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • E20 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - General (includes Measurement and Data)
    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models

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