Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/176803
Authors: 
Dreher, Axel
Fuchs, Andreas
Langlotz, Sarah
Year of Publication: 
2018
Series/Report no.: 
GLO Discussion Paper 195
Abstract: 
This article is the first to systematically study whether foreign aid affects the net flows of refugees 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, when we control for country- and time-fixed effects that capture the levels of the interacted variables. Although our results suggest that exogenous 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.
Subjects: 
foreign aid
Official Development Assistance
migration
refugees
displaced people
humanitarian crises
repatriation policies
JEL: 
F22
F35
F59
H84
O15
O19
Document Type: 
Working Paper

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