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In Western Europe, Asylum Seekers Benefit Host Countries’ Economies

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Refugees arriving in southern Europe. A new study suggests asylum seekers can benefit their host country's economy. | Fotomovimiento

Migrants and asylum seekers fleeing to Western European countries to escape war zones provide a boost to their host country's economy, according to a new report published in the June 20 issue of Science Advances.

By analyzing 30 years' worth of economic and migration data, the authors found that the flow of asylum seekers and permanent migrants significantly increased per capita gross domestic product, reduced unemployment and improved public finance balances.

The analysis also concluded that the positive economic effects brought on by migrants — people who intend to settle permanently in a host country — is immediate, whereas these positive effects are delayed for three to seven years for asylum seekers. Asylum seekers are people asking for protection in a host country, claiming that their country of origin is unsafe. If their request for asylum is accepted, they are classified as refugees and permanently remain in the host country.

Hippolyte d'Albis of the Paris School of Economics and the French National Center for Scientific Research (CNRS), an author of the analysis, said this work will help the public "understand that asylum seekers are not an economic issue for rich countries like those in Western Europe" and that these people should not be considered an "economic burden."

Rather, the migrant crisis currently experienced by Europe might instead be an economic opportunity, according to the authors.

Wars in Syria and the Middle East in the past two decades have caused a major humanitarian crisis. In 2015, Europe alone received more than one million asylum applications and many politicians and citizens of host countries have raised concerns about the additional public expense required to support migrants and asylum seekers.

The macroeconomic effects of both migrants and asylum seekers on host countries has not been adequately quantified, since studies to date have focused mainly on the effects of permanent migration and not of asylum seekers.

To provide insights into the economic consequences of migration flows — including asylum seekers — d'Albis and colleagues analyzed annual economic and migration data from 1985 to 2015, for 15 Western European countries that receive most of the asylum applications in Europe (89% in 2015, for example). The researchers applied a model that quantifies the economy's response to an unusual external event, or "shock" that could impact public finances. The increased flow of asylum seekers fleeing the Syrian war, said d'Albis, is one example of such a shock.

"We did not expect a positive economic effect of the flow of asylum seekers, but we were surprised to find that there was no negative effect. Increase in public expenditures is compensated by an increase in public revenues," said d'Albis.

While the effects of migrants' net flow were positive from the year of the shock and remained positive for at least two years, the flow of asylum seekers took longer to affect the economy; significant positive effects on the gross domestic product were observed three to seven years post-shock. These findings may be explained by the fact that asylum seekers generally are not allowed to work before they are granted refugee status, d'Albis said.

Since Western Europe is not the only region in the world experiencing an influx of migrants and asylum seekers, d'Albis said that as long as there is sufficient data coverage, the same methodology used in the study can be applied for other countries, such as the United States, to see how migrants and asylum seekers affect the host country's economy.

d'Albis and his colleagues recommend combining their economic analysis with political science and legal studies in the future to set up an efficient and more human legal system for asylum seekers and refugees.

Author

Alexandra Kirby