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Cousins from Overseas: The Labour Market Impact of a Major Forced Return Migration Shock

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  • Lara Bohnet
  • Susana Peralta
  • João Pereira dos Santos

Abstract

We study the labour market impact of a major shock of return migration, following the end of the Portuguese Colonial War in 1974. The retornados influx is unique because of its size (half a million people in a country of nine million), and similarity with the native population (almost 80% of the repatriates were Portuguese-born). Relying on rich census data from 1960 and 1981, with individual information on all repatriates, we document a sizeable 15% decrease for native males, and 62% for native females in dependent employment. Men move to self-employment, while women move to inactivity. The bulk of the effects is driven by Portuguese-born repatriates. We propose novel shift-share IVs, based on the repatriates’ municipality of birth, and the municipal hotel capacity, exploiting a large-scale resettlement program, and discuss possible mechanisms.

Suggested Citation

  • Lara Bohnet & Susana Peralta & João Pereira dos Santos, 2022. "Cousins from Overseas: The Labour Market Impact of a Major Forced Return Migration Shock," CESifo Working Paper Series 9971, CESifo.
  • Handle: RePEc:ces:ceswps:_9971
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    Keywords

    return migration; labour market; labour supply; entrepreneurship; instrumental variable;
    All these keywords.

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • J20 - Labor and Demographic Economics - - Demand and Supply of Labor - - - General
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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