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Forced Migration and Local Economic Development: Evidence from Postwar Hungary

Author

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  • Daniel Borbely

    (University of Dundee)

  • Ross Mckenzie

    (Department of Economics, University of Strathclyde)

Abstract

We investigate the persistent effects of forced migration on sending economies using the postWW2 expulsion of German minorities from Hungary as a natural experiment. We combine historical and contemporary data sources to show that, while towns heavily affected by the expulsions were quite similar to other areas in terms of economic activity and labour market composition before the war, the forced migrations led to lasting reductions in economic activity, and an increasing reliance on agricultural labour. We further show long-term negative correlations between forced migration and local trust levels, suggesting that the expulsion of Germans also affected the local social fabric. Our analysis reveals that forced migration can cause lasting regional inequalities in sending economies.

Suggested Citation

  • Daniel Borbely & Ross Mckenzie, 2021. "Forced Migration and Local Economic Development: Evidence from Postwar Hungary," Working Papers 2107, University of Strathclyde Business School, Department of Economics.
    • Handle: RePEc:str:wpaper:2107
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    More about this item

    Keywords

    forced migration; economic development; minorities; trust; persistence; regional inequality;
    All these keywords.

    JEL classification:

    • N34 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - Europe: 1913-
    • N94 - Economic History - - Regional and Urban History - - - Europe: 1913-
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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