Bonn: German Development Institute / Deutsches Institut für Entwicklungspolitik (DIE)
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This study exploits a natural experiment of three sudden Congolese refugee inflows to causally investigate the impact of an increased exposure to refugee presence on the Ugandan host population. We focus on the effects on female employment, household welfare and social cohesion among the host population. Using a repeated cross-section (pre- and post-treatment) of Demographic and Health Survey (DHS) data covering the years 2001 to 2011, we find that a higher exposure to our treatment variable increases the probability that Ugandan women are active in the labour market. This effect is mainly driven by agricultural employment. We also find that a higher treatment exposure has a positive impact on household wealth and a beneficial effect on nutritional indicators of children below the age of five. Our qualitative investigation suggests that incoming refugees improved labour market opportunities for Ugandan women, for instance, by increasing demand (such as for agricultural produce) and new marketing channels. These effects translated into positive average welfare effects for the host population. Irrespective of these welfare gains, analysing different dimensions of social cohesion using Afrobarometer data covering the years 2000 to 2012, we found that a higher exposure to our treatment variable was negatively associated with social cohesion indicators: a larger refugee presence was associated, for instance, with a rise in perceived inequality, as well as with lower levels of general trust among the host population. While the underlying mechanisms necessitate future research and a more nuanced analysis, we note that economic gains do not necessarily benefit social cohesion.