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The Impact of Syrian Migration on Unemployment: Evidence from Turkey

Year 2021, Volume: 11 Issue: 1, 1 - 30, 30.06.2021

Fatma Özgü Serttaş , Davut Uluöz

https://doi.org/10.31679/adamakademi.796016
Cited By: 1

Abstract

This study examines the labor market effects of the influx of the Syrian refugees in Turkey. Engle-Granger and Johansen co-integration tests, followed by the autoregressive distributive lag (ARDL) bounds tests reveal that the Turkish unemployment and Syrian refugee series are co-integrated; pointing out to a long-run relationship. Short-run and long-run dynamics have been analyzed from the fitted ARDL model and the error-correction parameter is used to examine the speed of convergence. Dynamic OLS (DOLS), fully modified least squares (FM-OLS) and canonical co-integrating regression (CCR) estimations are used to make inference on the long-run parameters. Empirical results show that there is a significant and negative relation between the level of unemployment in Turkey and the number of Syrian refugees in the long-run, indicating that the influx of Syrian refugees have had a reducing effect on unemployment numbers in Turkey. Our results suggest that the Syrian refugees have acted as a complementary labor force to the existing Turkish labor force.

Keywords

Forced refugees Migration Unemployment Co-integration ARDL DOLS FMOLS CCR Syrian refugees

References

  • Akgündüz, Y. E., & Torun, H. (2019). Two and a Half Million Syrian Refugees, Tasks and Capital Intensity. Central Bank of the Republic of Turkey Working Paper No: 19/23.
  • Akgündüz, Y. E., Berg, M., & Hassink, W. (2015). The Impact of Refugee Crises on Host Labor Markets: The Case of the Syrian Refugee Crisis. Disscussion Paper, no.8841; onn: IZA. IZA Disscussion Paper, no.8841.
  • Aksu, E., Erzan, R., & Kırdar, M. G. (2018). The Impact of Mass Migration of Syrians on the Turkish Labor Market. Bonn: IZA Discussion Papers The IZA Institute of Labor Economics.
  • Al-Azzam, A., & Hawdon, D. (1999). Estimating the Demand for Energy: A Stock and Watson Dynamic OLS (DOLS) approach. Surrey Energy Economics Discussion Paper series.
  • Ali, F., & Ibrahim, M. (2016). The Impact of Syrian Refugees on the Labor Market in Neighboring Countries: Empirical Evidence from Jordan. Defence and Peace Economics, 27(1), 64–86.
  • Aygün, E. (2020). European Civil Protection and Humanitarian aid Operations. https://ec.europa.eu/echo/where/europe/turkey_en.
  • Bahçekapılı, C., & Çetin, B. (2015). The Impacts of Forced Migration on Regional Economies: The Case of Syrian Refugees in Turkey. International Business Research Vol: 8 No:9, 1-15.
  • Borjas, G. J. (2013). Labor Economics. New York: McGraw-Hill.
  • Boubtane, E., Coulibaly, D., & Rault, C. (2013). Immigration, Growth, and Unemployment: Panel VAR Evidence from OECD Countries. TOC Volume 27 Issue 4, 399-420.
  • Card, D. (1990). The Impact of the Mariel Boatlift on the Miami Labor Market. Industrial and Labor Relations Review 43, 245-257.
  • Cengiz, D., & Tekgüç, H. (2018). Is It Merely a Labor Supply Shock? Impacts of Syrian Migrants on Local Economies in Turkey. Universitiy of Massachusetts Amherst Political Economy Research Institute Working Paper Series No: 454.
  • Ceritoglu, E., Yunculer, B. G., Torun, H., & S., T. (2017). The Impact of Syrian Refugees on Natives’ Labor Market Outcomes in Turkey: Evidence from a Quasi-experimental Design. IZA J Labor Policy 6, 5, https://doi.org/10.1186/s40173-017-0082-4.
  • Çakılcı, E. (2017). Do Syrian Refugees Have a Real Impact on Local Unemployment in Turkey? Journal of Human Sciences, 14(2), 1207-1214.
  • Damette, O., & Fromentine, V. (2013). Migration and Labour Markets in OECD Countries: A Panel Co-integration Approach. Applied Economics, 45 (16), 2295-2304.
  • David, A., A., M. M., C., N., & B., N. (2020). The Economics of the Syrian Refugee Crisis in Neighbouring Countries: The Case of Lebanon. Economics of Transition and Institutional Change Vol. 28 (1), 89-109.
  • Del Carpio, X. V., & Wagner, M. C. (2015). The Impact of Syrian Refugees on the Turkish Labor Market : The impact of Syrians refugees on the Turkish labor market. Policy Research Working Paper; No: WPS 7402.
  • Dickey, D., & Fuller, W. (1979). Distribution of the Estimators for Autoregressive Time Series with a Unit Root. Journal of the American Statistical Association, 74, 427-431.
  • Dickey, D., & Fuller, W. (1981). Likelihood Ratio Statistics for Autoregressive Time Series with a Unit Root. Econometrica, 49, 1057-1072.
  • Docquier, F., Özden, Ç., & Peri, G. (2011). The Labor Market Effects of Immigration and Emigration in OECD Countries. IZA Discussion Papers No. 6258.
  • Dumont, J.-C., & Liebig, T. (2014, 5 1). OECD Migration Policy Debates: Is migration good for the economy? Paris: OECD, International Migration Division.
  • Dustmann, C., Fabbri, F., & Preston, I. (2005). The Impact of Immigration on the British Labour Market. The Economic Journal, 115, 324-341.
  • Enders, W. (2015). Applied Econometric Time Series 4th ed. NewYork : Wiley.
  • Engle, R., & Granger, G. (1987). Co-integration and Error Correction: Representation, Estimation and Testing. Econometrica, 55, 51-276.
  • Esen, O., & Oğuş Binatlı, A. (2017). The Impact of Syrian Refugees on the Turkish Economy: Regional Labour Market Effects. Soc. Sci. 2017, 6, 129., https://doi.org/10.3390/socsci6040129.
  • European Union. (2020). The EU Response to the Refugee Crisis in Turkey. Delegation of the European Union to Turkey: https://www.avrupa.info.tr/en/eu-response-refugee-crisis-turkey-710 on 28.05.2020.
  • Fallah, B., Krafft, C., & Wahba, J. (2019). The impact of refugees on employment and wages in Jordan. Journal of Development Economics, 139, 203-216.
  • Giles, D. (2011). Testing for Granger Causality. https://davegiles.blogspot.com/2011/04/testing-for-granger-causality.html.
  • Harris, J. a. (1970). Migration, Unemployment and Development: A Two-sector Analysis. American Economic Review, 60, 126-142.
  • Hercowitz, Z. a. (1999). A Macroeconomic Experiment in Mass Immigration. . CEPR Discussion Papers 2983, C.E.P.R. Discussion Papers.
  • Hunt, J. (1992). The impact of the 1962 repatriates from Algeria on the French labor market. Industrial and Labor Relations Review, 45(3), 556-572.
  • Jean S., J. M. (2007). The Unemployment Impact of Immigration in OECD Countries. OECD Economics Department Working Paper, No. 563.
  • Johansen, S. (1988). Statistical Analysis of Co-integration Vectors. Journal of Economic Dynamics and Control, 12 (2–3), 231–254.
  • Johansen, S. (1991). Estimation and Hypothesis Testing of Co-integration Vectors in Gaussian Vector. Econometrica, 59(6), 1551–1580.
  • Kirişçi, K. (2014). Syrian Refugees and Turkey's Challenges: Going beyond Hospitality. Washington, D.C.: The Brookings Institution.
  • Narayan, P. K. (2005). The Saving and Investment Nexus for China: Evidence from Cointegration Tests. Applied Economics, 37, 1979–1990.
  • Narayan, P. K., & Narayan, N. (2005). Estimating income and price elasticities of imports for Fiji in a co-integration framework. Economic Modelling 22, 423– 438. Orhan O. & Gündoğar S., S. (2015). Effects of the Syrian Refugees on Turkey. Ankara: ORSAM Report No: 195.
  • P.K., N. (2005). The Saving and Investment Nexus for China: Evidence from Co-integration Tests. Applied Economics, 37, 1979–1990.
  • Park, J. (1992). Canonical Co-integrating Regressions. Econometrica: Journal of the Econometric Society, Vol.60(1), 119-143.
  • Pesaran, M. H. (2001). Bounds Testing Approaches to the Analysis of Level Relationships. Journal of Applied Econometrics, 16(3), 289-326.
  • Phillips, P., & Hansen, B. (1990). Statistical İnference in İnstrumental Variables Regression with I(1) Processes. The Review of Economic Studies, 57(1), 99-125.
  • Phillips, P., & Perron, P. (1988). Testing for a Unit Root in Time Series Regression. Bimetrika, 75, 335-346.
  • Pischke, J., & Velling, J. (1997). Employment Effects of Immigration to Germany: An Analysis based on Local Labor Markets. Review of Economics and Statistics 79 (4), 594-604.
  • Raphael, S., & Ronconi, L. (2007). The Effects of Labor Market Competition with Immigrants on the Wages and Employment of Natives: What Does Existing Research Tell Us? Du Bois Review: Social Science Research on Race, 4(2).
  • Shin, Y., & Pesaran, M. H. (1999). An Autoregressive Distributed Lag Modelling Approach to Co-integration Analysis. In S. Strom (Ed.), Econometrics and Economic Theory in the 20th century: The Ragnar Frish Centennial Symposium (pp. 371-413). Cambridge University Press.
  • Sims, C. A. (1980). Macroeconomics and Reality. Econometrica, 48(1), 1-48.
  • Stock, J., & Watson, M. (1993). A Simple Estimator of Co-integrating Vectors in Higher Order Integrated Systems. Econometrica: Journal of the Econometric Society, Vol.61(4), 783-820.
  • Suzuki, K., Paul, S., Maru, T., & M., K. (2019). An Empirical Analysis of the Effects of Syrian Refugees on the Turkish Labor Market. ADBI Working Paper 935.
  • TCMB. (2020). Basic Labour Force Indicators (TURKSTAT)(15+age). Central Bank of Turkey: https://evds2.tcmb.gov.tr/index.php?/evds/searchEvdsValue/QGnFn3NpekA= on 05.06.2020.
  • Toda, H.Y. & Yamamoto, M. (1995). Statistical Inferences in Vector Autoregressions with Possibly Integrated Processes. Journal of Econometrics, 66(1-2), 225-250.
  • Tumen, S. (2016). The Economic Impact of Syrian Refugees on Host Countries: Quasi-experimental Evidence from Turkey. American Economic Review, 106 (5), 456-60.
  • UNHCR. (2020). Registered Syrian Refugees by Date. Syria Regional Refugee Response - Inter agency Information sharing portal: http://data.unhcr.org/syrianrefugees/country.php?id=224.
  • Yarar, E. (2019). Turkey alone in its diplomatic, humanitarian efforts to assist Syrian refugees. Daily Sabah: https://www.dailysabah.com/diplomacy/2019/12/31/turkey-alone-in-its-diplomatic-humanitarian-efforts-to-assist-syrian-refugees on 28.05.2020.

The Impact of Syrian Migration on Unemployment: Evidence from Turkey

Year 2021, Volume: 11 Issue: 1, 1 - 30, 30.06.2021

Fatma Özgü Serttaş , Davut Uluöz

https://doi.org/10.31679/adamakademi.796016
Cited By: 1

Abstract

This study examines the labor market effects of the influx of the Syrian refugees in Turkey. Engle-Granger and Johansen co-integration tests, followed by the autoregressive distributive lag (ARDL) bounds tests reveal that the Turkish unemployment and Syrian refugee series are co-integrated; pointing out to a long-run relationship. Short-run and long-run dynamics have been analyzed from the fitted ARDL model and the error-correction parameter is used to examine the speed of convergence. Dynamic OLS (DOLS), fully modified least squares (FM-OLS) and canonical co-integrating regression (CCR) estimations are used to make inference on the long-run parameters. Empirical results show that there is a significant and negative relation between the level of unemployment in Turkey and the number of Syrian refugees in the long-run, indicating that the influx of Syrian refugees have had a reducing effect on unemployment numbers in Turkey. Our results suggest that the Syrian refugees have acted as a complementary labor force to the existing Turkish labor force.

Keywords

Forced refugees Syrian refugees Migration Unemployment Turkey ARDL DOLS FMOLS CCR

References

  • Akgündüz, Y. E., & Torun, H. (2019). Two and a Half Million Syrian Refugees, Tasks and Capital Intensity. Central Bank of the Republic of Turkey Working Paper No: 19/23.
  • Akgündüz, Y. E., Berg, M., & Hassink, W. (2015). The Impact of Refugee Crises on Host Labor Markets: The Case of the Syrian Refugee Crisis. Disscussion Paper, no.8841; onn: IZA. IZA Disscussion Paper, no.8841.
  • Aksu, E., Erzan, R., & Kırdar, M. G. (2018). The Impact of Mass Migration of Syrians on the Turkish Labor Market. Bonn: IZA Discussion Papers The IZA Institute of Labor Economics.
  • Al-Azzam, A., & Hawdon, D. (1999). Estimating the Demand for Energy: A Stock and Watson Dynamic OLS (DOLS) approach. Surrey Energy Economics Discussion Paper series.
  • Ali, F., & Ibrahim, M. (2016). The Impact of Syrian Refugees on the Labor Market in Neighboring Countries: Empirical Evidence from Jordan. Defence and Peace Economics, 27(1), 64–86.
  • Aygün, E. (2020). European Civil Protection and Humanitarian aid Operations. https://ec.europa.eu/echo/where/europe/turkey_en.
  • Bahçekapılı, C., & Çetin, B. (2015). The Impacts of Forced Migration on Regional Economies: The Case of Syrian Refugees in Turkey. International Business Research Vol: 8 No:9, 1-15.
  • Borjas, G. J. (2013). Labor Economics. New York: McGraw-Hill.
  • Boubtane, E., Coulibaly, D., & Rault, C. (2013). Immigration, Growth, and Unemployment: Panel VAR Evidence from OECD Countries. TOC Volume 27 Issue 4, 399-420.
  • Card, D. (1990). The Impact of the Mariel Boatlift on the Miami Labor Market. Industrial and Labor Relations Review 43, 245-257.
  • Cengiz, D., & Tekgüç, H. (2018). Is It Merely a Labor Supply Shock? Impacts of Syrian Migrants on Local Economies in Turkey. Universitiy of Massachusetts Amherst Political Economy Research Institute Working Paper Series No: 454.
  • Ceritoglu, E., Yunculer, B. G., Torun, H., & S., T. (2017). The Impact of Syrian Refugees on Natives’ Labor Market Outcomes in Turkey: Evidence from a Quasi-experimental Design. IZA J Labor Policy 6, 5, https://doi.org/10.1186/s40173-017-0082-4.
  • Çakılcı, E. (2017). Do Syrian Refugees Have a Real Impact on Local Unemployment in Turkey? Journal of Human Sciences, 14(2), 1207-1214.
  • Damette, O., & Fromentine, V. (2013). Migration and Labour Markets in OECD Countries: A Panel Co-integration Approach. Applied Economics, 45 (16), 2295-2304.
  • David, A., A., M. M., C., N., & B., N. (2020). The Economics of the Syrian Refugee Crisis in Neighbouring Countries: The Case of Lebanon. Economics of Transition and Institutional Change Vol. 28 (1), 89-109.
  • Del Carpio, X. V., & Wagner, M. C. (2015). The Impact of Syrian Refugees on the Turkish Labor Market : The impact of Syrians refugees on the Turkish labor market. Policy Research Working Paper; No: WPS 7402.
  • Dickey, D., & Fuller, W. (1979). Distribution of the Estimators for Autoregressive Time Series with a Unit Root. Journal of the American Statistical Association, 74, 427-431.
  • Dickey, D., & Fuller, W. (1981). Likelihood Ratio Statistics for Autoregressive Time Series with a Unit Root. Econometrica, 49, 1057-1072.
  • Docquier, F., Özden, Ç., & Peri, G. (2011). The Labor Market Effects of Immigration and Emigration in OECD Countries. IZA Discussion Papers No. 6258.
  • Dumont, J.-C., & Liebig, T. (2014, 5 1). OECD Migration Policy Debates: Is migration good for the economy? Paris: OECD, International Migration Division.
  • Dustmann, C., Fabbri, F., & Preston, I. (2005). The Impact of Immigration on the British Labour Market. The Economic Journal, 115, 324-341.
  • Enders, W. (2015). Applied Econometric Time Series 4th ed. NewYork : Wiley.
  • Engle, R., & Granger, G. (1987). Co-integration and Error Correction: Representation, Estimation and Testing. Econometrica, 55, 51-276.
  • Esen, O., & Oğuş Binatlı, A. (2017). The Impact of Syrian Refugees on the Turkish Economy: Regional Labour Market Effects. Soc. Sci. 2017, 6, 129., https://doi.org/10.3390/socsci6040129.
  • European Union. (2020). The EU Response to the Refugee Crisis in Turkey. Delegation of the European Union to Turkey: https://www.avrupa.info.tr/en/eu-response-refugee-crisis-turkey-710 on 28.05.2020.
  • Fallah, B., Krafft, C., & Wahba, J. (2019). The impact of refugees on employment and wages in Jordan. Journal of Development Economics, 139, 203-216.
  • Giles, D. (2011). Testing for Granger Causality. https://davegiles.blogspot.com/2011/04/testing-for-granger-causality.html.
  • Harris, J. a. (1970). Migration, Unemployment and Development: A Two-sector Analysis. American Economic Review, 60, 126-142.
  • Hercowitz, Z. a. (1999). A Macroeconomic Experiment in Mass Immigration. . CEPR Discussion Papers 2983, C.E.P.R. Discussion Papers.
  • Hunt, J. (1992). The impact of the 1962 repatriates from Algeria on the French labor market. Industrial and Labor Relations Review, 45(3), 556-572.
  • Jean S., J. M. (2007). The Unemployment Impact of Immigration in OECD Countries. OECD Economics Department Working Paper, No. 563.
  • Johansen, S. (1988). Statistical Analysis of Co-integration Vectors. Journal of Economic Dynamics and Control, 12 (2–3), 231–254.
  • Johansen, S. (1991). Estimation and Hypothesis Testing of Co-integration Vectors in Gaussian Vector. Econometrica, 59(6), 1551–1580.
  • Kirişçi, K. (2014). Syrian Refugees and Turkey's Challenges: Going beyond Hospitality. Washington, D.C.: The Brookings Institution.
  • Narayan, P. K. (2005). The Saving and Investment Nexus for China: Evidence from Cointegration Tests. Applied Economics, 37, 1979–1990.
  • Narayan, P. K., & Narayan, N. (2005). Estimating income and price elasticities of imports for Fiji in a co-integration framework. Economic Modelling 22, 423– 438. Orhan O. & Gündoğar S., S. (2015). Effects of the Syrian Refugees on Turkey. Ankara: ORSAM Report No: 195.
  • P.K., N. (2005). The Saving and Investment Nexus for China: Evidence from Co-integration Tests. Applied Economics, 37, 1979–1990.
  • Park, J. (1992). Canonical Co-integrating Regressions. Econometrica: Journal of the Econometric Society, Vol.60(1), 119-143.
  • Pesaran, M. H. (2001). Bounds Testing Approaches to the Analysis of Level Relationships. Journal of Applied Econometrics, 16(3), 289-326.
  • Phillips, P., & Hansen, B. (1990). Statistical İnference in İnstrumental Variables Regression with I(1) Processes. The Review of Economic Studies, 57(1), 99-125.
  • Phillips, P., & Perron, P. (1988). Testing for a Unit Root in Time Series Regression. Bimetrika, 75, 335-346.
  • Pischke, J., & Velling, J. (1997). Employment Effects of Immigration to Germany: An Analysis based on Local Labor Markets. Review of Economics and Statistics 79 (4), 594-604.
  • Raphael, S., & Ronconi, L. (2007). The Effects of Labor Market Competition with Immigrants on the Wages and Employment of Natives: What Does Existing Research Tell Us? Du Bois Review: Social Science Research on Race, 4(2).
  • Shin, Y., & Pesaran, M. H. (1999). An Autoregressive Distributed Lag Modelling Approach to Co-integration Analysis. In S. Strom (Ed.), Econometrics and Economic Theory in the 20th century: The Ragnar Frish Centennial Symposium (pp. 371-413). Cambridge University Press.
  • Sims, C. A. (1980). Macroeconomics and Reality. Econometrica, 48(1), 1-48.
  • Stock, J., & Watson, M. (1993). A Simple Estimator of Co-integrating Vectors in Higher Order Integrated Systems. Econometrica: Journal of the Econometric Society, Vol.61(4), 783-820.
  • Suzuki, K., Paul, S., Maru, T., & M., K. (2019). An Empirical Analysis of the Effects of Syrian Refugees on the Turkish Labor Market. ADBI Working Paper 935.
  • TCMB. (2020). Basic Labour Force Indicators (TURKSTAT)(15+age). Central Bank of Turkey: https://evds2.tcmb.gov.tr/index.php?/evds/searchEvdsValue/QGnFn3NpekA= on 05.06.2020.
  • Toda, H.Y. & Yamamoto, M. (1995). Statistical Inferences in Vector Autoregressions with Possibly Integrated Processes. Journal of Econometrics, 66(1-2), 225-250.
  • Tumen, S. (2016). The Economic Impact of Syrian Refugees on Host Countries: Quasi-experimental Evidence from Turkey. American Economic Review, 106 (5), 456-60.
  • UNHCR. (2020). Registered Syrian Refugees by Date. Syria Regional Refugee Response - Inter agency Information sharing portal: http://data.unhcr.org/syrianrefugees/country.php?id=224.
  • Yarar, E. (2019). Turkey alone in its diplomatic, humanitarian efforts to assist Syrian refugees. Daily Sabah: https://www.dailysabah.com/diplomacy/2019/12/31/turkey-alone-in-its-diplomatic-humanitarian-efforts-to-assist-syrian-refugees on 28.05.2020.
There are 52 citations in total.

Details

Primary Language English
Journal Section Articles
Authors

Fatma Özgü Serttaş 0000-0003-0746-3991

Davut Uluöz This is me 0000-0001-6801-5856

Publication Date June 30, 2021
Submission Date September 16, 2020
Published in Issue Year 2021 Volume: 11 Issue: 1

Cite

APA Serttaş, F. Ö., & Uluöz, D. (2021). The Impact of Syrian Migration on Unemployment: Evidence from Turkey. Adam Academy Journal of Social Sciences, 11(1), 1-30. https://doi.org/10.31679/adamakademi.796016

Cited By

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https://doi.org/10.3390/su14159223
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