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How do new immigration flows affect existing immigrants? Evidence from the refugee crisis in Germany

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  • Deole, Sumit S.
  • Huang, Yue

Abstract

We apply difference-in-differences regressions to study the impact of the 2015 refugee crisis in Germany on the culturally closer diaspora of existing immigrants originating from Turkey and Middle- Eastern and North-African countries (TMENA). Our identification allows us to emphasize the role of immigrants’ culture in estimating immigration’s socio-economic impact. Additionally, we distinguish between the labor demand and labor supply effects associated with immigration, which enables us to reflect on the ambiguous labor market impact of immigration suggested in the existing literature. In particular, we find that TMENA immigrants experienced a substantial reduction in unemployment in 2015, consistent with the differential demand shock induced by refugees’ consumption of culturally similar goods and services. However, the unemployment effects dissipated starting in 2016, coinciding with refugees’ delayed yet incremental labor market integration. We also consider the social impact of the refugee crisis and find that while worries about immigration increased among all respondents, the increases were statistically significantly smaller among TMENA immigrants, primarily due to their cultural proximity to arriving refugees. Our results suggest that TMENA immigrants’ assimilation of German identity was unaffected by the refugee crisis.

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  • Deole, Sumit S. & Huang, Yue, 2020. "How do new immigration flows affect existing immigrants? Evidence from the refugee crisis in Germany," GLO Discussion Paper Series 579, Global Labor Organization (GLO).
  • Handle: RePEc:zbw:glodps:579
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    Cited by:

    1. Cimpoeru Smaranda & Roman Monica & Kobeissi Amira & Mohammad Heba, 2020. "How are European Migrants from the MENA Countries Affected by COVID-19? Insights from an Online Survey," Journal of Social and Economic Statistics, Sciendo, vol. 9(1), pages 128-143, August.
    2. Christopher Prömel, 2022. "Belonging or Estrangement – The European Refugee Crisis and its Effects on Immigrant Identity," SOEPpapers on Multidisciplinary Panel Data Research 1160, DIW Berlin, The German Socio-Economic Panel (SOEP).
    3. Jaschke Philipp & Sulin Sardoschau & Marco Tabellini, 2021. "Scared Straight? Threat and Assimilation of Refugees in Germany," CReAM Discussion Paper Series 2136, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
    4. Deole, Sumit S. & Huang, Yue, 2020. "Suffering and prejudice: Do negative emotions predict immigration concerns?," GLO Discussion Paper Series 644, Global Labor Organization (GLO).
    5. Prömel, Christopher, 2021. "Belonging or estrangement: The European refugee crisis and its effects on immigrant identity," Discussion Papers 2021/16, Free University Berlin, School of Business & Economics.
    6. Jaschke, Philipp & Sardoschau, Sulin & Tabellini, Marco, 2021. "Scared Straight? Threat and Assimilation of Refugees in Germany," IZA Discussion Papers 14962, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    European refugee crisis; existing immigrants; socio-economic assimilation;
    All these keywords.

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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