Blessing or Burden? The Impact of Refugees on Businesses and the Informal Economy

54 Pages Posted: 16 Jun 2018

See all articles by Onur Altindag

Onur Altindag

Bentley University

Ozan Bakis

Bahcesehir University

Sandra Rozo

University of Southern California - Marshall School of Business; University of Southern California - Schaeffer Center for Health Policy and Economics

Date Written: May 31, 2018

Abstract

We study the impact of more than 3 million Syrian refugees on Turkish businesses operating in an economy with a large informal sector. We use an empirical, instrumental variable design that relies on exogenous variations in refugee outflows from Syria and the geographic location of Arabic-speaking communities in Turkey before the conflict began. Using yearly censuses of firms, we find that refugee inflows had a positive impact on the intensive and extensive margins of production, which are highly concentrated in the informal economy. The effects are stronger for smaller firms and those that operate in the construction and hospitality industries.

Keywords: refugees, firms, informality

JEL Classification: J46, J61, and O15

Suggested Citation

Altindag, Onur and Bakis, Ozan and Rozo, Sandra, Blessing or Burden? The Impact of Refugees on Businesses and the Informal Economy (May 31, 2018). Available at SSRN: https://ssrn.com/abstract=3188406 or http://dx.doi.org/10.2139/ssrn.3188406

Onur Altindag

Bentley University

175 Forest Street
Waltham, MA 02145
United States

Ozan Bakis

Bahcesehir University

Ciragan Avenue Osmanpaşa Mektebi Sokak No: 4 - 6
Besiktas
Istanbul, 34353
Turkey

Sandra Rozo (Contact Author)

University of Southern California - Marshall School of Business ( email )

701 Exposition Blvd
Los Angeles, CA 90089
United States

HOME PAGE: http://www.sandravrozo.com

University of Southern California - Schaeffer Center for Health Policy and Economics ( email )

635 Downey Way
Los Angeles, CA 90089-3333
United States

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