This paper examines the effects of large inflows of internally displaced persons (IDP), who are primarily absorbed by the informal sector, on the behavior of formal manufacturing firms in Colombia. To identify causal effects, the analysis employs annual, firm-level panel data between 1995 and 2010 and exploits that when conflict intensifies, forcefully displaced individuals tend to migrate to municipalities where people from their origin locations settled earlier. The paper finds that large inflows of IDP induce sizable, negative effects on the intensive and extensive margins of production of formal firms. These effects are stronger for firms operating in sectors that face a stronger competition from the informal economy.
Detalhes
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Autor
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Data do documento
2019/10/07
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TIpo de documento
Documento de trabalho sobre pesquisa de políticas
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No. do relatório
WPS9035
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Nº do volume
1
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Total Volume(s)
1
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País
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Região
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Data de divulgação
2019/10/07
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Disclosure Status
Disclosed
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Nome do documento
Is Informality Good for Business ? The Impacts of IDP Inflows on Formal Firms
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Palavras-chave
first stage; in work; informal sector; homicide rate; Municipalities; illegal arm; central government transfer; effect of immigration on wages; total number of individual; forced migrant; pay taxes; tax collection; public expenditure; municipal tax; armed attack; lower level of education; low levels of education; standard error; labor force survey; forced displacement; negative effect; intermediate consumption; Displaced Population; Forced Migration; effects of immigration; labor market outcome; impact of immigration; country of origin; million people; effects of migration; working age population; Agriculture; impact of refugees; Internally Displaced Person; sale of asset; net entry effect; victims of violence; linear probability model; number of migrants; formal labor market; cost of production; terms of skills; labor market success; changes in capital; number of immigrants; increase in consumption; Rule of Law; highly educated individual; local labor market; labor demand curve; changes in risk; integration of refugees; Internally Displaced People; net investment
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