Inequality and Security in the Aftermath of Internal Population Displacement Shocks :Evidence from Nigeria

This paper studies the security implications of internal displacement shocks for hostcommunities. It focuses on changes in wealth within host communities induced by the inflow of internally displacedpersons (IDPs) as a potential mechanism that triggers local conflicts. The sudden insurgency of the jihadist terroristorganization Boko Haram, which led to the internal displacement of over 2.5 million persons in northeasternNigeria, is used as a quasi-natural experiment. Applying both a two-way fixed effects analysis and an instrumentalvariable strategy based on historical ethnic ties between the areas of displacement and receiving areas, the resultsshow that the presence of IDPs is associated with a decrease in aggregate wealth and an increase in inequality withinhost communities, between 2010 and 2019. These effects are accompanied by an increased risk of conflict onset in theshort and long run. The inequality–conflict link is likely to be caused by grievances among low-wealth segments of thehost community towards new arrivals rather than by changes in social cohesion within host communities, which increasedin response to the inflow of IDPs. The analysis further indicates that an improvement in IDPs’ living conditions isaccompanied by a decrease in violence and improved relations between hosts and IDPs. Taken together, findings from thisstudy call for a two-pronged immediate relief and recovery approach that alleviates adverse economic effects onvulnerable segments of host communities and increases IDPs’ welfare in displacement settings.