How Mass Immigration Affects Countries with Weak Economic Institutions: A Natural Experiment in Jordan

53 Pages Posted: 26 Mar 2018

See all articles by Alex Nowrasteh

Alex Nowrasteh

Cato Institute - Center for Global Liberty and Prosperity

Andrew Forrester

Cato Institute - Center for Global Liberty and Prosperity

Cole Blondin

Middlebury College

Multiple version iconThere are 2 versions of this paper

Date Written: March 2018

Abstract

Saddam Hussein's unexpected 1990 invasion of Kuwait forced 300,000 Kuwaitis of Palestinian descent to flee into Jordan. By 1991, this large exogenous population shock increased Jordan's population by about 10 percent. Jordanian law allowed these refugees to work, live, and vote in Jordan immediately upon entry. The refugees did not bring social capital that eroded Jordan's institutions. On the contrary, we find that Jordan's economic institutions substantially improved in the decade after the refugees arrived. Our empirical methodology employs difference-in-differences and the synthetic control method, both of which indicate that the significant improvement in Jordanian economic institutions would not have happened to the same extent without the influx of refugees. Our case study indicates that the refugee surge was the main mechanism by which Jordan's economic institutions improved over this time.

Keywords: Jordan, Institutions, Immigration, Refugees, Governance, Public Choice

JEL Classification: P1, J6, P16, F22

Suggested Citation

Nowrasteh, Alex and Forrester, Andrew and Blondin, Cole, How Mass Immigration Affects Countries with Weak Economic Institutions: A Natural Experiment in Jordan (March 2018). Available at SSRN: https://ssrn.com/abstract=3149543 or http://dx.doi.org/10.2139/ssrn.3149543

Alex Nowrasteh (Contact Author)

Cato Institute - Center for Global Liberty and Prosperity ( email )

1000 Massachusetts Avenue, N.W.
Washington, DC 20001-5403
United States

Andrew Forrester

Cato Institute - Center for Global Liberty and Prosperity ( email )

1000 Massachusetts Avenue, N.W.
Washington, DC 20001-5403
United States

Cole Blondin

Middlebury College ( email )

Middlebury, VT 05753
United States

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