study compares the outcomes of Venezuelans with those of Brazilians.<sup>6</sup> All the integration measures indicate that in spite of little legal barriers, Venezuelans face challenges in accessing education, formal jobs and social protection in Brazil. Venezuelans are 0.47 times as likely to be in school, 0.3 times as likely to be employed in the formal sector, and 0.7 times as likely to be registered in single registry compared to their Brazilian counterparts. The findings suggest that only 42% Venezuelan children enroll in school and even when they do, they experience grade downgrading and capacity constraints, making it harder to attain productive human capital and make future generations self-reliant. In the formal labor market, their employment is of much lower quality than the Brazilian, characterized by high temporality and greater work hours, despite the higher schooling levels suggesting they also face occupation downgrading in Brazil. Controlling for selection into wage employment, there seems to be also a significant wage penalty for Venezuelans. Consequently, more educated Venezuelans and Venezuelans with higher number of children are more likely to register in the unified registry<sup>7</sup> than their Brazilian counterparts. Overall, integration seems to be higher where the population of Venezuelan migrants and refugees is lower, controlling for selection, especially in education, supporting previous literature by Lazaer (1999) and Carneiro et al. (2020). It should be noted here that theoretically a larger network of refugees and migrants can provide more information about job prospects, school requirements, social protection benefits and local customs and traditions, promoting integration (Gautier, 2020), but in the case of Brazil, concentration in certain localities like Roraima and most Venezuelan migrants and asylums being new to the situation, seem to be creating an overcrowding e↵ect constraining integration.

This paper is divided into six sections. Section 2 starts with a description of the migration trend in Brazil and key demographic characteristics of the Venezuelan refugees and migrants and then moves on to give a brief literature review on forced displacement and economic integration, focusing on the work on Venezuelan refugees and migrants in Latin American countries. Section 3 provides details on the variables and the methodology employed. Section 4 describes the data and presents the summary statistics with an emphasis on the e↵ect of the COVID-19 pandemic.<sup>8</sup> Section 5 presents the results, while Section 6 concludes with some policy implications and discusses venue for further research.

# **2 Refugee and Migration Trends and Literature Review**

The refugees and migrants population in Brazil has been increasing rapidly from 2016 and the blue bar in Figure 1 shows that the total refugees and migrants population increased from about 0.7 million in 2016 to about 1.4 million in July 2020. From being one of the lowest asylum seeking and migrants population in 2016, among the Latin American countries, Venezuelans in Brazil quickly became the largest refugee and migrant population by 2019. Brazil also has significant number of nationals<sup>9</sup> from Bolivia and Haiti, followed by Colombia, Argentina and China. During the period of July 2017 to October 2020, Brazil received about 126,256 migrants and 30,000 asylum seekers

> 6Venezuelans could also be compared with the other migrants, but this study concentrates on the Brazilians by birth as this paper is more focused on the extent of local integration in Brazil.

> 7The Unified Registry of Social Programs (CadUnico) is a database that collects details about low-income families in Brazil, which can be used to identify vulnerable people in the society and develop appropriate benefits for them. The details are given in the Methodology section.

> 8Impact analysis of the COVID-19 pandemic is not possible due to unavailability of data.

> 9Regular refugees and migrants

4