Bolter, 2020) and consequently it serves as a case study to see whether different legal constraints can lead to observed outcomes.

This paper assesses the short term consequences of the Venezuelan influx on the overall labor market and fiscal balance in the Brazilian state of Roraima, using a regression discontinuity framework, that exploits a sharp jump in population in Roraima in the first quarter of 2018, which witnessed an inflow of Venezuelans of about 19,497, which is 3.8% of Roraima’s population in the first quarter, and an inflow of about 117,347, which is 18% of its population in the year of 2018. Using the Continuous National Household Sample Survey for population and labor market data and the National Treasury Secretariat data for the fiscal variables, this paper finds that the population shock of about 6.7% in the working age population of Roraima was accompanied by a spur in social assistance expenditure of about 1.6 million Brazilian reais, which is a 50% increase from its value in the sixth bi-month of 2017. However, total government expenditure and fiscal balance did not increase significantly in relation to the increase in migration. On the labor market, the 6.7% increase in working age population led to an increase in unemployment among females living in the state by about 22%, and employment among females decreased by about 12%, suggesting that females are suffering disproportionately more from the displacement crisis as Roraima tries to absorb the excess supply in the short-run with no sizable effect among males. Employment among those with an education below college degree plummeted down by about 5%, while monthly income went up for the high skilled. It should be noted here that due to unavailability of nationality information, this paper focuses on the impact on the overall market including migrants, not just on the native community. Overall the results suggest that although there are some winners and some losers of the population shock, the more vulnerable groups of the labor force bear a disproportionate burden of the displacement crisis.

This paper is divided into six sections. Section 2 gives a description of the migration trend in Brazil, focusing on the influx of Venezuelan refugees and migrants and a discussion on the overall economy of Roraima. Section 3 provides a brief survey of the past literature, while Section 4 discusses the time-series data and the main variables used. Section 5 discusses the identification strategy and Section 6 presents the results along with robustness check and falsification analysis, while Section 7 concludes with some policy implications and discusses venues for further research.

# **2 Venezuelan Migration in Brazil and the Economy of Roraima**

The diaspora population in Brazil has been increasing rapidly from 2016 and the blue bar in Figure 1 shows that the total migrants and asylum seeker population increased from about 0.7 million in 2016 to about 1.4 million in July 2020. From being one of the lowest diaspora populations in 2016, among the Latin American countries, Venezuelans in Brazil (shown in brown) quickly became the largest migrant population by 2019. Brazil also has significant number of migrants<sup>4</sup> from Bolivia and Haiti, followed by Colombia, Argentina and China as the figure shows. During the period of July 2017 to October 2020, Brazil received about 126,256 migrants and 30,000 asylum

> 4Regular migrants and asylum seekers

3