The impact of internal displacement on destination communities: Evidence from the Colombian conflict

More than ten percent of the population of Colombia has been forced to migrate due to civil war. This study employs an enclave IV strategy, which exploits social distance between origin and destination locations, as well as conflict-induced migration, to estimate the impact that the arrival of displaced individuals has on the wages of local residents. I compare the effects on four different subgroups of the population, partitioned by skill (low-skilled versus high-skilled) and by gender. The analysis suggests that a conflict-induced increase in population leads to a short-run negative impact on wages, but that subsequent out-migration from receiving municipalities helps to mitigate these effects. Though the impact tends to dissipate over time, it persists for low-skilled women, suggesting that this group is particularly vulnerable to the arrival of forced migrants.