IDEAS home Printed from https://ideas.repec.org/p/tcb/wpaper/1601.html
   My bibliography  Save this paper

Immigration and Prices : Quasi-Experimental Evidence from Syrian Refugees in Turkey

Author

Listed:
  • Binnur Balkan Konuk
  • Semih Tumen

Abstract

We exploit the regional variation in the unexpected (or forced) inflow of Syrian refugees as a natural experiment to estimate the impact of immigration on consumer prices in Turkey. Using a difference-in-differences strategy and a comprehensive data set on the regional prices of CPI items, we find that general level of consumer prices has declined by approximately 2.5 percent due to immigration. Prices of goods and services have declined in similar magnitudes. We highlight that the channel through which the price declines take place is the informal labor market. Syrian refugees supply inexpensive informal labor and, thus, substitute the informal native workers especially in informal labor intensive sectors. We document that prices in these sectors have fallen by around 4 percent, while the prices in the formal labor intensive sectors have almost remained unchanged. Increase in the supply of informal immigrant workers generates labor cost advantages and keeps prices lower in the informal labor intensive sectors.

Suggested Citation

  • Binnur Balkan Konuk & Semih Tumen, 2016. "Immigration and Prices : Quasi-Experimental Evidence from Syrian Refugees in Turkey," Working Papers 1601, Research and Monetary Policy Department, Central Bank of the Republic of Turkey.
  • Handle: RePEc:tcb:wpaper:1601
    as

    Download full text from publisher

    File URL: http://www.tcmb.gov.tr/wps/wcm/connect/EN/TCMB+EN/Main+Menu/Publications/Research/Working+Paperss/2016/16-01
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    as
    1. Bentolila, Samuel & Dolado, Juan J. & Jimeno, Juan F., 2008. "Does immigration affect the Phillips curve? Some evidence for Spain," European Economic Review, Elsevier, vol. 52(8), pages 1398-1423, November.
    2. Zachariadis, Marios, 2012. "Immigration and international prices," Journal of International Economics, Elsevier, vol. 87(2), pages 298-311.
    3. Cohen-Goldner, Sarit & Paserman, M. Daniele, 2011. "The dynamic impact of immigration on natives' labor market outcomes: Evidence from Israel," European Economic Review, Elsevier, vol. 55(8), pages 1027-1045.
    4. Zachariadis, Marios, 2011. "Immigration and international prices: An initial assessment," Economics Letters, Elsevier, vol. 110(2), pages 83-85, February.
    5. Card, David & Krueger, Alan B, 1994. "Minimum Wages and Employment: A Case Study of the Fast-Food Industry in New Jersey and Pennsylvania," American Economic Review, American Economic Association, vol. 84(4), pages 772-793, September.
    6. George J. Borjas, 1995. "The Economic Benefits from Immigration," Journal of Economic Perspectives, American Economic Association, vol. 9(2), pages 3-22, Spring.
    7. Semih Tumen, 2015. "The use of natural experiments in migration research," IZA World of Labor, Institute for the Study of Labor (IZA), pages 191-191, October.
    8. Rachel M. Friedberg, 2001. "The Impact of Mass Migration on the Israeli Labor Market," The Quarterly Journal of Economics, Oxford University Press, vol. 116(4), pages 1373-1408.
    9. David Card, 1990. "The Impact of the Mariel Boatlift on the Miami Labor Market," ILR Review, Cornell University, ILR School, vol. 43(2), pages 245-257, January.
    10. Jennifer Hunt, 1992. "The Impact of the 1962 Repatriates from Algeria on the French Labor Market," ILR Review, Cornell University, ILR School, vol. 45(3), pages 556-572, April.
    11. Mansour, Hani, 2010. "The effects of labor supply shocks on labor market outcomes: Evidence from the Israeli-Palestinian conflict," Labour Economics, Elsevier, vol. 17(6), pages 930-939, December.
    12. Borjas, George J. & Bronars, Stephen G. & Trejo, Stephen J., 1992. "Self-selection and internal migration in the United States," Journal of Urban Economics, Elsevier, vol. 32(2), pages 159-185, September.
    13. Eric D. Gould & Victor Lavy & M. Daniele Paserman, 2009. "Does Immigration Affect the Long-Term Educational Outcomes of Natives? Quasi-Experimental Evidence," Economic Journal, Royal Economic Society, vol. 119(540), pages 1243-1269, October.
    14. Akgündüz, Yusuf Emre & van den Berg, Marcel & Hassink, Wolter, 2015. "The Impact of Refugee Crises on Host Labor Markets: The Case of the Syrian Refugee Crisis in Turkey," IZA Discussion Papers 8841, Institute for the Study of Labor (IZA).
    15. Jean-François Maystadt & Philip Verwimp, 2014. "Winners and Losers among a Refugee-Hosting Population," Economic Development and Cultural Change, University of Chicago Press, vol. 62(4), pages 769-809.
    16. Borjas, George J, 1987. "Self-Selection and the Earnings of Immigrants," American Economic Review, American Economic Association, vol. 77(4), pages 531-553, September.
    17. Semih Tumen, 2016. "The Economic Impact of Syrian Refugees on Host Countries: Quasi-experimental Evidence from Turkey," American Economic Review, American Economic Association, vol. 106(5), pages 456-460, May.
    18. Marianne Bertrand & Esther Duflo & Sendhil Mullainathan, 2004. "How Much Should We Trust Differences-In-Differences Estimates?," The Quarterly Journal of Economics, Oxford University Press, vol. 119(1), pages 249-275.
    19. Moulton, Brent R., 1986. "Random group effects and the precision of regression estimates," Journal of Econometrics, Elsevier, vol. 32(3), pages 385-397, August.
    20. George J. Borjas, 1994. "The Economics of Immigration," Journal of Economic Literature, American Economic Association, vol. 32(4), pages 1667-1717, December.
    21. Evren Ceritoglu & H. Burcu Gurcihan Yunculer & Huzeyfe Torun & Semih Tumen, 2017. "The impact of Syrian refugees on natives’ labor market outcomes in Turkey: evidence from a quasi-experimental design," IZA Journal of Labor Policy, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 6(1), pages 1-28, December.
    22. Saul Lach, 2007. "Immigration and Prices," Journal of Political Economy, University of Chicago Press, vol. 115(4), pages 548-587, August.
    23. Patricia Cortes, 2008. "The Effect of Low-Skilled Immigration on U.S. Prices: Evidence from CPI Data," Journal of Political Economy, University of Chicago Press, vol. 116(3), pages 381-422, June.
    24. Jan Saarela & Fjalar Finnäs, 2009. "Forced migration and mortality in the very long term: Did perestroika affect death rates also in Finland?," Demography, Springer;Population Association of America (PAA), vol. 46(3), pages 575-587, August.
    25. M Daniele Paserman, 2013. "Do high-skill immigrants raise productivity? Evidence from Israeli manufacturing firms, 1990-1999," IZA Journal of Migration and Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 2(1), pages 1-31, December.
    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. Evren Ceritoglu & H. Burcu Gurcihan Yunculer & Huzeyfe Torun & Semih Tumen, 2017. "The impact of Syrian refugees on natives’ labor market outcomes in Turkey: evidence from a quasi-experimental design," IZA Journal of Labor Policy, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 6(1), pages 1-28, December.
    2. Isabel Ruiz & Carlos Vargas-Silva, 2017. "The impact of hosting refugees on the intra-household allocation of tasks: A gender perspective," WIDER Working Paper Series 066, World Institute for Development Economic Research (UNU-WIDER).
    3. Semih Tumen, 2015. "The use of natural experiments in migration research," IZA World of Labor, Institute for the Study of Labor (IZA), pages 191-191, October.
    4. Stefan Seifert & Marica Valente, 2018. "An Offer that you Can't Refuse? Agrimafias and Migrant Labor on Vineyards in Southern Italy," Discussion Papers of DIW Berlin 1735, DIW Berlin, German Institute for Economic Research.
    5. Bratti, Massimiliano & De Benedictis, Luca & Santoni, Gianluca, 2018. "Immigrant Entrepreneurs, Diasporas and Exports," IZA Discussion Papers 11280, Institute for the Study of Labor (IZA).

    More about this item

    Keywords

    Immigration; Consumer prices; Syrian refugees; Natural experiment; Informal employment;

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • J46 - Labor and Demographic Economics - - Particular Labor Markets - - - Informal Labor Market
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

    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:tcb:wpaper:1601. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ozlem Ekmekciler Ramalho Rocha) or (Ilker Cakar). General contact details of provider: http://edirc.repec.org/data/tcmgvtr.html .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.