is the second bimonth of 2018 and afterwards for the fiscal variables or the first quarter of 2018 and afterwards for the labor market variables. Table A13 and table A14 show the estimates of _α_ along with the weights that each of the northern states receive in forming synthetic control state. The covariates used to match for the fiscal variables include index for the service sector from IBGE and the cost of making per square feet, while the covariates used for the labor market includes gender ratio, youth dependency, household size, average age and fraction of white and college educated from the pre-2018 time period. Results that remain consistent are that there is a social assistance spending shock due to the inflow of Venezuelan refugees and migrants in Roraima but revenue collected from indirect taxes also increased, while the population shock led to an increase in unemployment, suggesting the in the short-run, the labor market in Roraima may be finding it difficult to absorb the excess labor supply. The estimates can be interpreted as the average treatment effects as explained in Abadie et al. (2010).

# **7 Conclusion**

The inflow of forcibly displaced Venezuelans into Brazil is a humanitarian crisis but has created a development challenge since most of them have entered through Roraima, the state of Brazil bordering the Rep ́ublica Bolivariana de Venezuela at the north. The economy of Roraima is small and is mainly dependent on the public sector and although it is relatively easy for forcibly displaced Venezuelans in Brazil to get labor cards and work in the private sector, jobs in the public sector are out of their bounds. This paper uses a regression discontinuity design to study the impact of the population shock caused by the influx of the forcibly displaced Venezuelans on Roraima and finds that although in the short-run they have a negligible effect on Roraima’s fiscal balance and is not only incurring additional social assistance expenditure but also may be contributing through indirect taxation, the labor market is finding it challenging to absorb the excess supply. It finds that in the immediate short-run, the influx of Venezuelans has led to an increase in unemployment and decrease in employment among female and low skilled workers, and the effect on earnings seems to vary by sectors, with the highly skilled male workers are experiencing an increase in income in construction and information technology, while the low skilled worker are experiencing an increase in earnings in education, health and transport, suggesting heterogenous impacts of the displaced Venezuelans on the labor market. These asymmetrical impacts on earnings are in line with previous literature, which finds that low-skilled and female workers tend to experience negative impacts, while more-educated workers benefit from increased immigration. It should be noted here that this paper focuses on short-run effects and previous literature like Card (1990) finds that the initial effects of “boatlift” or influx of about 125,000 Cubans in Miami were decline in employment rates and wages, but about three years after the huge influx, wages and employment rates in Miami showed no effect.

The main caveats in the analysis are the unavailability of nationality information in PNADC and consequently, the results discussed in the paper show the effect on the overall market. Another point to emphasize here is that RD estimates are local treatment effects and cannot be generalized. As a result further research needs to be conducted to identify the actual effect on the host community.

However, results of this paper suggest certain policy implications that may mitigate the negative impacts of the influx of the displaced Venezuelan on the labor market and facilitate their fiscal contribution. Policies may focus on supporting the most vulnerable host populations like women 31