The Impact of Syrian Refugees on Inflation in Turkey: ARDL Bounds Testing Approach

Abstract

In April 2011, the influx of migrants from Syria to Turkey soon made Turkey the world's most refugee-hosting country. Recently, the number of Syrian refugees, whose number has exceeded 3.5 million, has many social, political and economic effects on Turkey. In particular, recent inflation rates in Turkey raise the question of whether the rise in inflation is one of the negative effects of Syrian refugees on the economy. This study is expected to contribute to the literature, due to the lack of similar empirical practice, on the effect of international migration on inflation in Turkey. The study examined the effect of the Syrian refugee population on inflation in Turkey using ARDL bounds test with monthly data for the period 2012:01-2019:06. In the study, the dependent variable is inflation rate and the Syrian population living in Turkey is used as explanatory variable while the unemployment rate, credit interest rate and world oil price are included in the model as control variables. The findings presented in this study reveal that the Syrian population has a significant inflation boosting effect in Turkey.