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The Refugee Surge in Europe: Economic Challenges

Author

Listed:
  • Mr. Shekhar Aiyar
  • Ms. Bergljot B Barkbu
  • Nicoletta Batini
  • Mr. Helge Berger
  • Ms. Enrica Detragiache
  • Allan Dizioli
  • Mr. Christian H Ebeke
  • Ms. Huidan Huidan Lin
  • Ms. Linda Kaltani
  • Mr. Sebastian Sosa
  • Mr. Antonio Spilimbergo
  • Petia Topalova

Abstract

Against the background of political turmoil in the Middle-East, Europe faces an unprecedented surge in asylum applications. In analyzing the economic impact of this inflow, this paper draws from the experience of previous economic migrants and refugees, mindful of the fact that the characteristics of economic migrants can be different from refugees. In the short-run, additional public expenditure will provide a small positive impact on GDP, concentrated in the main destination countries of Germany, Sweden and Austria. Over the longer-term, depending on the speed and success of the integration of refugees in the labor market, the increase in the labor force can have a more lasting impact on growth and the public finances. Here good policies will make an important difference. These include lowering barriers to labor markets for refugees, for example through wage subsidies to employers, and, in particular, reducing legal barriers to labor market participation during asylum process, removing obstacles to entrepreneurship/self-employment, providing job training and job search assistance, as well as language skills. While native workers often have legitimate concerns about the impact of immigrants on wages and employment, past experience indicates that any adverse effects are limited and temporary.

Suggested Citation

  • Mr. Shekhar Aiyar & Ms. Bergljot B Barkbu & Nicoletta Batini & Mr. Helge Berger & Ms. Enrica Detragiache & Allan Dizioli & Mr. Christian H Ebeke & Ms. Huidan Huidan Lin & Ms. Linda Kaltani & Mr. Sebas, 2016. "The Refugee Surge in Europe: Economic Challenges," IMF Staff Discussion Notes 2016/002, International Monetary Fund.
    • Handle: RePEc:imf:imfsdn:2016/002
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    Citations

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    Cited by:

    1. Ludovica Gambaro & Guido Neidhöfer & C. Katharina Spieß, 2019. "The Effect of Early Childhood Education and Care Services on the Social Integration of Refugee Families," Discussion Papers of DIW Berlin 1828, DIW Berlin, German Institute for Economic Research.
    2. Rippy Das & Kabindra Sharma, 2023. "Security Predicament of Syrian Refugees Through Gender Lens in Line with EU–Turkey Joint Action Plan 2015," International Studies, , vol. 60(2), pages 209-230, April.
    3. Dries Lens & Ive Marx & Sunčica Vujić, 2017. "Integrating (former) asylum seekers into the Belgian labour market. What can we learn from the recent past?," Working Papers 1710, Herman Deleeck Centre for Social Policy, University of Antwerp.
    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. 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.
    6. Francesco Fasani & Tommaso Frattini & Luigi Minale, 2022. "(The Struggle for) Refugee integration into the labour market: evidence from Europe [Cashier or consultant? Entry labor market conditions, field of study, and career success]," Journal of Economic Geography, Oxford University Press, vol. 22(2), pages 351-393.
    7. Shakir, Zeeniya & Masih, Mansur, 2016. "How is the European debt crisis affecting islamic equity? challenges in portfolio diversification within the eurozone: A markov switching and continuous wavelet transform analysis," MPRA Paper 71683, University Library of Munich, Germany.
    8. Vadlamannati, Krishna Chaitanya & Kelly, Grace, 2017. "Welfare Chauvinism? Refugee Flows and Electoral Support for Populist-right Parties in Industrial Democracies," MPRA Paper 81816, University Library of Munich, Germany.
    9. Müller, Tobias & Pannatier, Pia & Viarengo, Martina, 2023. "Labor market integration, local conditions and inequalities: Evidence from refugees in Switzerland," World Development, Elsevier, vol. 170(C).
    10. Francesco Fasani & Tommaso Frattini & Luigi Minale, 2017. "The (Struggle for) Labour Market Integration of Refugees: Evidence from European Countries," RF Berlin - CReAM Discussion Paper Series 1716, Rockwool Foundation Berlin (RF Berlin) - Centre for Research and Analysis of Migration (CReAM).
    11. Giang Ho & Ms. Rima A Turk, 2018. "The Labor Market Integration of Migrants in Europe: New Evidence from Micro Data," IMF Working Papers 2018/232, International Monetary Fund.
    12. Lens, Dries & Marx, Ive & Vujic, Suncica, 2018. "Is Quick Formal Access to the Labor Market Enough? Refugees' Labor Market Integration in Belgium," IZA Discussion Papers 11905, Institute of Labor Economics (IZA).
    13. Gina Ionela Butnaru & Marilena Mironiuc & Carmen Huian & Alina Petronela Haller, 2018. "Analysis of Economic Growth in Tourism Under the Impact of Terrorism and of the Waves of Refugees," The AMFITEATRU ECONOMIC journal, Academy of Economic Studies - Bucharest, Romania, vol. 20(S12), pages 885-885, November.
    14. Ohlert, Clemens & Bruttel, Oliver, 2018. "Auswirkungen des gesetzlichen Mindestlohns auf die Beschäftigungssituation von Geflüchteten : Stand der Forschung, methodische Ansätze und Erschließung von Datenquellen," FDZ Methodenreport 201807_de, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    15. Rosario Maria Ballatore & Adele Grompone & Lucia Lucci & Patrizia Passiglia & Andrea Sechi, 2017. "Refugees and asylum seekers in Italy and in the EU," Questioni di Economia e Finanza (Occasional Papers) 377, Bank of Italy, Economic Research and International Relations Area.
    16. Bernhard Riederer, 2018. "Experts’ Expectations of Future Vulnerability at the Peak of the “Refugee Crisis”," VID Working Papers 1809, Vienna Institute of Demography (VID) of the Austrian Academy of Sciences in Vienna.
    17. Christian Gunadi, 2021. "The Labour Market Effects of Venezuelan Refugee Crisis in the United States," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 83(6), pages 1311-1340, December.
    18. Gambaro, Ludovica & Neidhöfer, Guido & Spiess, C. Katharina, 2021. "The effect of early childhood education and care services on the integration of refugee families," Labour Economics, Elsevier, vol. 72(C).
    19. repec:iab:iabfme:201807(de is not listed on IDEAS

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