Living in Limbo: Economic and Social Costs for Refugees

Abstract

Our paper tests the hypothesis that living in limbo could have negative consequences for socio-economic integration of refugees. We define limbo as a protracted time period when asylum seekers are granted only a temporary residence permit linked to the asylum application, waiting for the decision concerning a permanent refugee status. To quantify the impact of limbo, we rely on the data from the French survey of migrants, ELIPA. We measure integration by labor market participation, fluency in French, finding new French friends and studying. We first demonstrate that limbo is exogenous as it is not related to the ability of refugees to fulfill administrative procedures. Then, we show that a higher share of the time living in limbo slows down all aspects of socio-economic integration, except fluency in French. The chances of a given refugee being employed are 1.2 times higher than for a refugee that spent one standard deviation more time in limbo, while the odds of having French friends and studying in France are 1.7 times higher, respectively. There are little gender differences.