Forced displacement in Colombia: Causality and welfare losses / Forced displacement in Colombia: Causality and welfare losses

Date: 10 November 2018

Author/s: Ana María Ibañez, Carlos Eduardo Vélez ;

Abstract (Original Language):

During the last decade forced internal displacement in Colombia has been a growing phenomenon closely linked to the escalation of the internal armed conflict-particularly in rural areas. The displacement problem has hit nearly every region and vulnerable groups of the population. Two emerging policy questions are whether the magnitude of the response to this problem has been proportional to the size of the problem and to what extent the instruments chosen are the most adequate to contain it. The purpose of this paper is twofold. First, to identify the determinants of the displacement behavior and to compare those findings with standard migration literature. Second, to estimate the burden or welfare losses of displacement. Empirical evidence shows that the welfare loss of displacement is considerable and amount to 25 percent of the net present value of rural lifetime aggregate consumption, for the average individual. This loss is estimated for each individual with a method that derives welfare changes from behavioral model estimates – widely used in environmental and transport economics. Our empirical findings also show that the level of violence at the origin site is not only the dominant factor of displacement behavior, but also that in a violent environment other migration determinants have the opposite effect, relative to the one expected by the migration literature in a non-violent context. That is, the violent environment reverses the migration incentives for risk aversion, access to information, the planning horizon, location-specific assets – human and non-human. Finally, separate modeling of preventive and reactive displacement behavior reveals higher welfare losses for more risk averse households and important asymmetries about the benefits of security force presence.

Country of Interest: Colombia

Type: Articles

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