In summary, the two available studies for the 1974 returnees to Portugal are rather consistent in finding a significant negative effect on wages in the years following 1974 for the agriculture and construction sectors whereas the evidence on employment and unemployment is nonconclusive.

# IDPs in Colombia

Colombia has a long history of internal violence that claimed hundreds of thousands of lives since the late 1950s. Such violence has been mainly linked to the emergence of powerful revolutionary groups including the Revolutionary Armed Forces of Colombia (FARC) and the National Liberation Army (ELN) and to paramilitary groups that initially emerged to contrast these revolutionary groups. In the 1980s, internal violence intensified due to the expansionary ambitions of the revolutionary groups that led to a civil war against the state and the increasing violence perpetrated by military and paramilitary groups. As a consequence of this violence, many civilians who had been caught in the fighting were forced to flee. The conflict affected mostly the North-East of Colombia and almost five million people have been estimated to have fled this area since the early 1980s. These internally displaced persons were mostly from rural areas and settled mostly in urban areas and had a level of education comparable with low-skilled workers in urban areas.

Calderon-Mejia and Ibanez (2016) use household survey data and an IV approach to assess the impact of IDPs on the hourly wages of host communities. They find that a 10 percent increase in the share of IDPs reduces hourly wages by 0.88% with this effect being larger for women as compared to men. The effect is smaller (0.63%) but still negative and significant for manual male workers and management and professional female workers (0.64%) whereas is non-significant for female manual labor and male management/professional labor. The most affected workers are independent/self-employed workers with females (2.28%) suffering more than males (1.31%), particularly those with high school education or less (2.0%).

Morales (2017) use survey, census and registry data covering the 1993-2005 period to study the same caseload of IDPs in Colombia. Short-run effects indicate a negative impact on wages. A one percent increase in population due to IDPs results in a 1.4 % reduction in local wages with this effect being larger for women, particularly low skilled women (2.2%). The effect is also negative and significant for high skilled men but smaller (0.7%). In this case, OLS and IV estimations concord with IV estimations showing larger effects. The long-run effects show instead a positive effect with OLS estimations and a negative effect for low-skilled women and no effects for other groups with IV estimations. There is therefore some evidence that the negative effects tend to disappear in the long-run but not for all groups. This study is also one of the few studies that considers the potential impact on outmigration. It finds that an increase of 1% in population due to IDPs generates an outmigration of 0.2-0.3 people per 100 residents.

The two studies reviewed on labor market impacts in Colombia are therefore very consistent in finding a negative effect on wages with the effect being larger for women and low skilled workers, notably in the informal sector. This effect also seems to be attenuated in the long-run, possibly due to outmigration and other labor market adjustments.

Using administrative panel data on quarterly IDP flows and rental prices by income level between 19992014 for 13 cities in Colombia (which received 66% of all IDPs), Depetris-Chauvin’s and Santos’ (2018) OLS estimates show a significant positive impact of IDP inflows on average rental prices for low- and middle-income housing, which may last up to 10 quarters. Results for high-income housing are nonsignificant. Their IV approach does not show statistically significant impacts on rental prices on average; but rental prices for low-income housing increase while they decrease for high-income housing. This is one of the few papers that explores potential channels through which the IDP inflow might impact the variable of interest. They provide evidence that the heterogeneous impact on rental prices might be due to an increase in supply of high-income housing, as licenses for new non-social interest housing increase while those for social interest housing decrease, and wages in the construction sector decrease, reducing construction costs.

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