Host-Refugee Labor Market Friction Asymmetry
RCTClinical Trial
Active labor market programs often treat host-country citizens and displaced refugees as facing identical job search barriers. However, baseline liquidity constraints, search intensity, and legal vulnerabilities differ systematically, causing uniform interventions to produce starkly heterogeneous outcomes.
Picture this
Imagine two runners in a race. The local runner already has proper shoes and runs at full speed but faces limited job openings. The guest runner is wearing heavy boots (liquidity constraints and past displacement shocks). Giving both runners a small grant for new running shoes helps the guest runner dramatically increase their speed, whereas it makes no difference to the local runner who already had good shoes.
What the evidence says
Cash transfers increased Syrian wage employment by 5.2 percentage points at 2 months (p = 0.017) and 3.8 percentage points at 4 months (p = 0.027), while raising earnings by 65%. In contrast, cash had no significant effect on Jordanians (-0.007 at 2 months, -0.025 at 4 months), as Jordanians had 25% higher baseline daily expenditure, searched 30% more intensely, and filed twice as many job applications in the control group.
- Who was studied
- N = 3,770 jobseekers (1,663 Syrian refugees and 2,107 Jordanians) in urban Jordan.
- How
- Comparative RCT evaluating cash, information, and nudge interventions across host nationals and refugees at 2-month and 4-month follow-ups.
What to do
Evaluate baseline search intensity and liquidity metrics separately for host national and refugee populations before deploying active labor market assistance to avoid misallocating funds.
From the source
"We find essentially no positive effects of treatment on the Jordanian sample. The Syrians and Jordanians who take part in our study differ on multiple dimensions at baseline, and their outcomes evolve in different ways over time."
An Adaptive Targeted Field Experiment: Job Search Assistance for Refugees in Jordan