The Impact of Afghan Refugee Influx on Labor Market Outcomes in Pakistan

Abstract

The study gauges the impact of refugee influx on the labor market in Pakistan. The impact of Afghan refugees was analyzed using three indicators of labor market namely,unemployment, formal employment and informal employment from years 1979 to 2022. ARDL bound test for co-integrationis used to derive long run and short run relationship between labor market indicators and refugee inflow. It is found that Afghan refugees have caused positive impact on the labor market of Pakistan in long run while, in the short run it increase unemployment rate. Hence, it is concluded that refugees can serve as stimulus for investment and production in the country.