The Effects of Foreign Aid on Refugee Flows
Axel Dreher, Andreas Fuchs and Sarah Langlotz
Published in: European Economic Review 112:127-147, February 2019
Abstract
We investigate whether foreign aid affects refugee flows from recipient countries. Combining refugee data on 141 origin countries over the 1976-2013 period with bilateral Official Development Assistance data, we estimate the causal effects of a country’s aid receipts on both total refugee flows to the world and flows to donor countries. The interaction of donor-government fractionalization and a recipient country’s probability of receiving aid provides a powerful and excludable instrumental variable (IV), when we control for country- and time-fixed effects that capture the levels of the interacted variables. Though our IV results suggest that aid induces recipient governments to encourage the return of their citizens, we find no evidence that aid reduces worldwide refugee outflows or flows to donor countries in the short term. However, we observe long-run effects after four three-year periods, which appear to be driven by lagged positive effects of aid on growth.
Published paper
Supplementary information
Working paper (February 2018)
Working paper (January 2018)
Presentations at conferences and workshops
In the media (newspapers, blogs)
See also
Axel Dreher, Andreas Fuchs and Sarah Langlotz
Published in: European Economic Review 112:127-147, February 2019
Abstract
We investigate whether foreign aid affects refugee flows from recipient countries. Combining refugee data on 141 origin countries over the 1976-2013 period with bilateral Official Development Assistance data, we estimate the causal effects of a country’s aid receipts on both total refugee flows to the world and flows to donor countries. The interaction of donor-government fractionalization and a recipient country’s probability of receiving aid provides a powerful and excludable instrumental variable (IV), when we control for country- and time-fixed effects that capture the levels of the interacted variables. Though our IV results suggest that aid induces recipient governments to encourage the return of their citizens, we find no evidence that aid reduces worldwide refugee outflows or flows to donor countries in the short term. However, we observe long-run effects after four three-year periods, which appear to be driven by lagged positive effects of aid on growth.
Published paper
Supplementary information
Working paper (February 2018)
Working paper (January 2018)
Presentations at conferences and workshops
- Research Seminar at the Department of Economics, University of Bergen, Norway (06/2018)
- IfW Special Staff Seminar, Kiel Institute for the World Economy, Kiel, Germany (06/2018)
- International Conference on Globalization and Development, University of Goettingen, Germany (05/2018)
- RITM Economics Seminar, Université Paris Sud, France (02/2018)
- Annual Conference on "Immigration in OECD Countries," Paris (12/2017)
- Hamburg Lecture on Law & Economics, University of Hamburg, Germany (11/2017)
- DIAL Development Conference, Université Paris-Dauphine, France (06/2017)
- 10th International Conference on “Migration and Development”, Center for Research on International Development (CERDI), Clermont-Ferrand, France (06/2017)
- Beyond Basic Questions Workshop, University of Milan, Italy (06/2017)
- Annual Conference of the Verein für Socialpolitik Research Committee Development Economics, University of Goettingen, Germany (06/2017)
- 2017 ZEW Public Finance Conference: Public Finance and Development, ZEW, Mannheim, Germany (05/2017)
- Annual Meeting of the European Public Choice Society (EPCS), Central European University, Budapest, Hungary (04/2017)
- DIE Research Seminar, German Development Institute, Bonn, Germany (03/2017)
- Workshop “The Domestic Dimensions of Development Cooperation”, University of Antwerp, Belgium (10/2016)
In the media (newspapers, blogs)
- Frankfurter Allgemeine Zeitung (in German)
- Le Monde (in French)
See also
- FAZ Essay Podcast (in German)
- Frankfurter Allgemeine Zeitung (in German)
- Frankfurter Allgemeine Zeitung (reply by Winfried Pinger, in German)
