Does Language Training Improve the Economic Integration of Refugees? Evidence from Germany's Response to the Refugee Crisis

Abstract

The successful integration of refugees into the local economy has become a major policy challenge for European countries in light of the global displacement crisis. One of the key challenges is to support refugees to learn the language of their host country. Several European countries provide publicly funded language training for asylum seekers and refugees shortly after arrival, but there is scant evidence on the impact of these early training programs on subsequent economic integration. We examine the impact of two such programs policymakers in Germany used in response to the large increase in the number of asylum seekers in 2015: a rapidly developed, ad hoc program that offered basic language training to over 230,000 newly arrived refugees and a smaller, preexisting program that offered refugees comprehensive language training. We leverage register data on the entire population of asylum seekers who arrived in 2015-2016 and exploit program eligibility and temporal participation variation using regression discontinuity and difference-in-differences designs to evaluate and contrast the effectiveness of both programs. We find that the ad hoc program had no discernible effect on refugee employment over the following 24 months. In contrast, the more comprehensive, preexisting program increased refugee employment by about 13 percentage points. These findings have implications for how policymakers can design effective language training programs to foster the integration of refugees.

Type
Preprint
Publication
(Working Paper)