IDEAS home Printed from https://ideas.repec.org/p/iza/izadps/dp14766.html
   My bibliography  Save this paper

Do Refugees with Better Mental Health Better Integrate? Evidence from the Building a New Life in Australia Longitudinal Survey

Author

Listed:
  • Dang, Hai-Anh

    (World Bank)

  • Trinh, Trong-Anh

    (World Bank)

  • Verme, Paolo

    (World Bank)

Abstract

Hardly any evidence currently exists on the causal effects of mental illness on refugee labor market outcomes. We offer the first study on this topic in the context of Australia, one of the host countries with the largest number of refugees per capita in the world. Analyzing the Building a New Life in Australia longitudinal survey, we exploit the variations in traumatic experiences of refugees interacted with time as an instrument for refugee mental health. We find that worse mental health, as measured by a one standard deviation increase in the Kessler mental health score, reduces the probability of employment by 14.1% and labor income by 26.8%. We also find some evidence of adverse impacts of refugees' mental illness on their children's mental health and education performance. These effects appear more pronounced for refugees that newly arrive or are without social networks, but they may be ameliorated with government support. Our findings suggest that policies that target refugees' mental health may offer a new channel to improve their labor market outcomes.

Suggested Citation

  • Dang, Hai-Anh & Trinh, Trong-Anh & Verme, Paolo, 2021. "Do Refugees with Better Mental Health Better Integrate? Evidence from the Building a New Life in Australia Longitudinal Survey," IZA Discussion Papers 14766, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp14766
    as

    Download full text from publisher

    File URL: https://docs.iza.org/dp14766.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Moya, Andrés, 2018. "Violence, psychological trauma, and risk attitudes: Evidence from victims of violence in Colombia," Journal of Development Economics, Elsevier, vol. 131(C), pages 15-27.
    2. Harold Alderman & John Hoddinott & Bill Kinsey, 2006. "Long term consequences of early childhood malnutrition," Oxford Economic Papers, Oxford University Press, vol. 58(3), pages 450-474, July.
    3. LoPalo, Melissa, 2019. "The effects of cash assistance on refugee outcomes," Journal of Public Economics, Elsevier, vol. 170(C), pages 27-52.
    4. Christian Dustmann & Francesco Fasani & Tommaso Frattini & Luigi Minale & Uta Schönberg, 2017. "On the economics and politics of refugee migration," Economic Policy, CEPR, CESifo, Sciences Po;CES;MSH, vol. 32(91), pages 497-550.
    5. Jean-Marie Dufour & Mohamed Taamouti, 2005. "Projection-Based Statistical Inference in Linear Structural Models with Possibly Weak Instruments," Econometrica, Econometric Society, vol. 73(4), pages 1351-1365, July.
    6. Di Maio, Michele & Nisticò, Roberto, 2019. "The effect of parental job loss on child school dropout: Evidence from the Occupied Palestinian Territories," Journal of Development Economics, Elsevier, vol. 141(C).
    7. James Heckman & Flavio Cunha, 2007. "The Technology of Skill Formation," American Economic Review, American Economic Association, vol. 97(2), pages 31-47, May.
    8. Nathan Nunn & Nancy Qian, 2014. "US Food Aid and Civil Conflict," American Economic Review, American Economic Association, vol. 104(6), pages 1630-1666, June.
    9. Verme, Paolo & Schuettler, Kirsten, 2021. "The impact of forced displacement on host communities: A review of the empirical literature in economics," Journal of Development Economics, Elsevier, vol. 150(C).
    10. Singhal, Saurabh, 2019. "Early life shocks and mental health: The long-term effect of war in Vietnam," Journal of Development Economics, Elsevier, vol. 141(C).
    11. Dagnelie, Olivier & Mayda, Anna Maria & Maystadt, Jean-François, 2019. "The labor market integration of refugees in the United States: Do entrepreneurs in the network help?," European Economic Review, Elsevier, vol. 111(C), pages 257-272.
    12. Eoin McGuirk & Marshall Burke, 2020. "The Economic Origins of Conflict in Africa," Journal of Political Economy, University of Chicago Press, vol. 128(10), pages 3940-3997.
    13. Dreher, Axel & Fuchs, Andreas & Langlotz, Sarah, 2019. "The effects of foreign aid on refugee flows," European Economic Review, Elsevier, vol. 112(C), pages 127-147.
    14. Nicole Watson & Mark Wooden, 2010. "Data Survey: The HILDA Survey: Progress and Future Developments," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 43(3), pages 326-336, September.
    15. Lochmann, Alexia & Rapoport, Hillel & Speciale, Biagio, 2019. "The effect of language training on immigrants’ economic integration: Empirical evidence from France," European Economic Review, Elsevier, vol. 113(C), pages 265-296.
    16. Ole Agersnap & Amalie Jensen & Henrik Kleven, 2020. "The Welfare Magnet Hypothesis: Evidence from an Immigrant Welfare Scheme in Denmark," American Economic Review: Insights, American Economic Association, vol. 2(4), pages 527-542, December.
    17. Jacob Nielsen Arendt & Iben Bolvig & Mette Foged & Linea Hasager & Giovanni Peri, 2020. "Language Training and Refugees' Integration," NBER Working Papers 26834, National Bureau of Economic Research, Inc.
    18. Courtney Brell & Christian Dustmann & Ian Preston, 2020. "The Labor Market Integration of Refugee Migrants in High-Income Countries," Journal of Economic Perspectives, American Economic Association, vol. 34(1), pages 94-121, Winter.
    19. Flavio Cunha & James J. Heckman & Susanne M. Schennach, 2010. "Estimating the Technology of Cognitive and Noncognitive Skill Formation," Econometrica, Econometric Society, vol. 78(3), pages 883-931, May.
    20. Staubli, Stefan & Zweimüller, Josef, 2013. "Does raising the early retirement age increase employment of older workers?," Journal of Public Economics, Elsevier, vol. 108(C), pages 17-32.
    21. Jacob Nielsen Arendt & Iben Bolvig & Mette Foged & Linea Hasager & Giovanni Peri, 2021. "Language Training and Refugees’ Integration," RF Berlin - CReAM Discussion Paper Series 2104, Rockwool Foundation Berlin (RF Berlin) - Centre for Research and Analysis of Migration (CReAM).
    22. Asatryan, Zareh & Bittschi, Benjamin & Doerrenberg, Philipp, 2017. "Remittances and public finances: Evidence from oil-price shocks," Journal of Public Economics, Elsevier, vol. 155(C), pages 122-137.
    23. Clausen, Jens & Heinesen, Eskil & Hummelgaard, Hans & Husted, Leif & Rosholm, Michael, 2009. "The effect of integration policies on the time until regular employment of newly arrived immigrants: Evidence from Denmark," Labour Economics, Elsevier, vol. 16(4), pages 409-417, August.
    24. James J. Heckman & Jora Stixrud & Sergio Urzua, 2006. "The Effects of Cognitive and Noncognitive Abilities on Labor Market Outcomes and Social Behavior," Journal of Labor Economics, University of Chicago Press, vol. 24(3), pages 411-482, July.
    25. Piopiunik, Marc & Ruhose, Jens, 2017. "Immigration, regional conditions, and crime: Evidence from an allocation policy in Germany," European Economic Review, Elsevier, vol. 92(C), pages 258-282.
    26. Joan Esteban & Laura Mayoral & Debraj Ray, 2012. "Ethnicity and Conflict: An Empirical Study," American Economic Review, American Economic Association, vol. 102(4), pages 1310-1342, June.
    27. Chatterji, Pinka & Alegria, Margarita & Takeuchi, David, 2011. "Psychiatric disorders and labor market outcomes: Evidence from the National Comorbidity Survey-Replication," Journal of Health Economics, Elsevier, vol. 30(5), pages 858-868.
    28. A. Colin Cameron & Douglas L. Miller, 2015. "A Practitioner’s Guide to Cluster-Robust Inference," Journal of Human Resources, University of Wisconsin Press, vol. 50(2), pages 317-372.
    29. Aarethun, V. & Sandal, G.M. & Guribye, E. & Markova, V. & Bye, H.H., 2021. "Explanatory models and help-seeking for symptoms of PTSD and depression among Syrian refugees," Social Science & Medicine, Elsevier, vol. 277(C).
    30. Lori A. Beaman, 2012. "Social Networks and the Dynamics of Labour Market Outcomes: Evidence from Refugees Resettled in the U.S," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 79(1), pages 128-161.
    31. Dang, Hai-Anh H. & Trinh, Trong-Anh, 2023. "Diluted blood still better than water? The beneficial effects of politicians' birthplaces on refugee acceptance," GLO Discussion Paper Series 1300, Global Labor Organization (GLO).
    32. David Roodman, 2011. "Fitting fully observed recursive mixed-process models with cmp," Stata Journal, StataCorp LP, vol. 11(2), pages 159-206, June.
    33. Paul Frijters & David W. Johnston & Michael A. Shields, 2014. "The Effect Of Mental Health On Employment: Evidence From Australian Panel Data," Health Economics, John Wiley & Sons, Ltd., vol. 23(9), pages 1058-1071, September.
    34. Axel Dreher & Andreas Fuchs & Bradley Parks & Austin Strange & Michael J. Tierney, 2021. "Aid, China, and Growth: Evidence from a New Global Development Finance Dataset," American Economic Journal: Economic Policy, American Economic Association, vol. 13(2), pages 135-174, May.
    35. Kaivan Munshi, 2003. "Networks in the Modern Economy: Mexican Migrants in the U. S. Labor Market," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 118(2), pages 549-599.
    36. Gong, Jie & Lu, Yi & Xie, Huihua, 2020. "The average and distributional effects of teenage adversity on long-term health," Journal of Health Economics, Elsevier, vol. 71(C).
    37. Isabel Ruiz & Carlos Vargas-Silva, 2018. "Differences in labour market outcomes between natives, refugees and other migrants in the UK," Journal of Economic Geography, Oxford University Press, vol. 18(4), pages 855-885.
    38. Andersen, Martin, 2015. "Heterogeneity and the effect of mental health parity mandates on the labor market," Journal of Health Economics, Elsevier, vol. 43(C), pages 74-84.
    39. Steel, Zachary & Momartin, Shakeh & Silove, Derrick & Coello, Marianio & Aroche, Jorge & Tay, Kuo Wei, 2011. "Two year psychosocial and mental health outcomes for refugees subjected to restrictive or supportive immigration policies," Social Science & Medicine, Elsevier, vol. 72(7), pages 1149-1156, April.
    40. Villalonga-Olives, E. & Wind, T.R. & Armand, A.O. & Yirefu, M. & Smith, R. & Aldrich, D.P., 2022. "Social-capital-based mental health interventions for refugees: A systematic review," Social Science & Medicine, Elsevier, vol. 301(C).
    41. Janet Currie & Valentina Duque & Irwin Garfinkel, 2015. "The Great Recession and Mothers' Health," Economic Journal, Royal Economic Society, vol. 125(588), pages 311-346, November.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Hans Dietrich & José Luis Álvaro Estramiana & Alicia Garrido Luque & Volker Reissner, 2023. "Effects of Posttraumatic Stress Disorder and Mental Disorders on the Labor Market Integration of Young Syrian Refugees," IJERPH, MDPI, vol. 20(3), pages 1-18, January.
    2. Mathilde Sengoelge & Alexander Nissen & Øivind Solberg, 2022. "Post-Migration Stressors and Health-Related Quality of Life in Refugees from Syria Resettled in Sweden," IJERPH, MDPI, vol. 19(5), pages 1-14, February.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Seonho Shin, 2022. "Evaluating the Effect of the Matching Grant Program for Refugees: An Observational Study Using Matching, Weighting, and the Mantel-Haenszel Test," Journal of Labor Research, Springer, vol. 43(1), pages 103-133, March.
    2. Jacob Nielsen Arendt & Christian Dustmann & Hyejin Ku, 2022. "Refugee migration and the labour market: lessons from 40 years of post-arrival policies in Denmark [‘The Dynamics of Return Migration, Human Capital Accumulation, and Wage Assimilation’]," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 38(3), pages 531-556.
    3. Demirci, Murat & Kırdar, Murat Güray, 2023. "The labor market integration of Syrian refugees in Turkey," World Development, Elsevier, vol. 162(C).
    4. Zenou, Yves & Boucher, Vincent & Tumen, Semih & Vlassopoulos, Michael & Wahba, Jackline, 2020. "Ethnic Mixing in Early Childhood: Evidence from a Randomized Field Experiment and a Structural Model," CEPR Discussion Papers 15528, C.E.P.R. Discussion Papers.
    5. Matilda Kilström & Birthe Larsen & Elisabet Olme, 2023. "Temporary refugee protection and labor-market outcomes," Empirical Economics, Springer, vol. 65(4), pages 1895-1929, October.
    6. Francesco Fasani & Tommaso Frattini & Luigi Minale, 2021. "Lift the Ban? Initial Employment Restrictions and Refugee Labour Market Outcomes," Journal of the European Economic Association, European Economic Association, vol. 19(5), pages 2803-2854.
    7. Hans Dietrich & José Luis Álvaro Estramiana & Alicia Garrido Luque & Volker Reissner, 2023. "Effects of Posttraumatic Stress Disorder and Mental Disorders on the Labor Market Integration of Young Syrian Refugees," IJERPH, MDPI, vol. 20(3), pages 1-18, January.
    8. Foged, Mette & van der Werf, Cynthia, 2023. "Access to language training and the local integration of refugees," Labour Economics, Elsevier, vol. 84(C).
    9. Jacob Nielsen Arendt, 2022. "Labor market effects of a work-first policy for refugees," Journal of Population Economics, Springer;European Society for Population Economics, vol. 35(1), pages 169-196, January.
    10. Zheng, Xiaodong & Fang, Zuyi & Wang, Yajun & Fang, Xiangming, 2022. "When left-behind children become adults and parents: The long-term human capital consequences of parental absence in China," China Economic Review, Elsevier, vol. 74(C).
    11. Aksoy, Cevat Giray & Poutvaara, Panu & Schikora, Felicitas, 2023. "First time around: Local conditions and multi-dimensional integration of refugees," Journal of Urban Economics, Elsevier, vol. 137(C).
    12. Shoji, Masahiro, 2020. "Early-Life Circumstances and Adult Locus of Control: Evidence from 46 Developing Countries," MPRA Paper 99987, University Library of Munich, Germany.
    13. Fasani, Francesco & Frattini, Tommaso & Pirot, Maxime, 2023. "From Refugees to Citizens: Labor Market Returns to Naturalization," IZA Discussion Papers 16651, Institute of Labor Economics (IZA).
    14. Seonho Shin, 2021. "Were they a shock or an opportunity?: The heterogeneous impacts of the 9/11 attacks on refugees as job seekers—a nonlinear multi-level approach," Empirical Economics, Springer, vol. 61(5), pages 2827-2864, November.
    15. Hangartner, Dominik & Sarvimäki, Matti & Spirig, Judith, 2021. "Managing Refugee Protection Crises: Policy Lessons from Economics and Political Science," IZA Discussion Papers 14821, Institute of Labor Economics (IZA).
    16. Huong Thu Le & Ha Trong Nguyen, 2017. "Parental health and children's cognitive and noncognitive development: New evidence from the longitudinal survey of Australian children," Health Economics, John Wiley & Sons, Ltd., vol. 26(12), pages 1767-1788, December.
    17. Seonho Shin, 2022. "To work or not? Wages or subsidies?: Copula-based evidence of subsidized refugees’ negative selection into employment," Empirical Economics, Springer, vol. 63(4), pages 2209-2252, October.
    18. Marc‐André Luik & Amelia Guha Thakurta & Dennis Wesselbaum, 2021. "Child health, human capital, and adult financial behavior," Health Economics, John Wiley & Sons, Ltd., vol. 30(11), pages 2722-2750, November.
    19. Jacob Nielsen Arendt & Iben Bolvig & Mette Foged & Linea Hasager & Giovanni Peri, 2020. "Language Training and Refugees' Integration," NBER Working Papers 26834, National Bureau of Economic Research, Inc.
    20. Cole, Matthew A. & Jabbour, Liza & Ozgen, Ceren & Yumoto, Hiromi, 2024. "Refugees' Economic Integration and Firms," IZA Discussion Papers 16828, Institute of Labor Economics (IZA).

    More about this item

    Keywords

    refugees; mental health; labor outcomes; instrumental variable; BNLA longitudinal survey; Australia;
    All these keywords.

    JEL classification:

    • I15 - Health, Education, and Welfare - - Health - - - Health and Economic Development
    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp14766. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Holger Hinte (email available below). General contact details of provider: https://edirc.repec.org/data/izaaade.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.