25 Years IWH

Refugees - a global humanitarian crisis reaches Germany



In short

Millions of refugees are currently posing enormous challenges for EU Member States, with regard to both the distribution and integration of the refugees themselves and supportive social cohesion. The IWH demonstrates how refugees and costs could be distributed in an economically efficient manner – even taking account of demographic developments in Germany and other countries.

Our expert


Europe's task of the century

Between summer 2015 and March 2016, thousands of refugees arrived in Germany every day. While the agreement with Turkey has diffused the situation for the EU in the short-term, the underlying problem has not disappeared. This is because the existing European asylum system is fundamentally flawed. It is unable to cope with the current situation – despite the fact that the issue itself is not new. A coherent European asylum policy is now more important than ever. The Common European Asylum System (CEAS) last revised in 2013 has made no impact and refugees are still distributed extremely unevenly throughout Europe. The IWH has already considered a fair distribution that takes account of the distribution of both people and costs.

The integration of the new arrivals in society and the employment market has linguistic, educational, cultural and political dimensions. Whether and how Germany can make economic use of the opportunities provided by immigration is currently under discussion. Due to the complexity of the topic, however, an interdisciplinary scientific approach such as that by the “Crisis in a Globalised World” Research Alliance is essential, in order to understand the mutual mechanisms and dynamics. Analyses by the IWH, for instance, show that measures to tackle immigration in the latter part of 2015 triggered additional economic impetus. The Federal and State Governments increased their budgets and spending on housing, food, healthcare and general refugee assistance stimulated demand and production, especially in the construction, hospitality and corporate services sectors. According to the calculations of the Joint Economic Forecast Project Group, migration-related spending across Germany contributed 0.1 per cent to the growth in gross domestic product in 2015.

One in 113 people across the globe are now considered to be refugees, a total of 65 million. In order to combat the complex “refugee” problem, politicians need to be much better organised and ideally develop collective actions. Only then can the most efficient - and above all humanitarian - solution be achieved.

Current IWH Publications


Regionale Migration in Abhängigkeit von Humankapital und sektoraler Struktur : eine empirische Analyse am Beispiel von Deutschland und Polen

Alexander Kubis

in: IWH-Sonderhefte , 1010


The theory on human capital predicts that job changes between occupations require investments in occupation-specific knowledge. Thus, regional differences in occupational structure should affect income expectations for the region of destination. While previous macro-econometric models of migration control for several regional determinants, they have so far neglected the effects of human capital investments. The thesis proposes a method to implement human capital as a determinant of migration flows between German NUTS 3 regions. The results indicate that expected required investments in human capital reduce regional migration. In addition, the thesis presents a model of polish migration flows within Poland at the NUTS 2 level. On the basis of the results, migration flows from Polish to German regions are predicted, assuming that the abolishment of barriers to migration after 2011 implies that the determinants of migration flows between countries resemble those prevailing within the country.

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Out-migration and Regional Convergence

Alexander Kubis Lutz Schneider

in: Wirtschaft im Wandel , No. 10, 2009


Since 1989, the migration deficit of East Germany has accumulated to 1.8 million people. Against this background, the contribution analyses the relationship between regional migration and regional growth. From a theoretical point of view, one might find reasons in favour and in opposition to a convergence supporting function of migration. If migrants are taken from the upper tail of the human capital distribution of a poor region, divergence is the probable outcome. If on the other hand people with low human capital endowment move to richer regions, migration might enhance regional convergence. The empirical analysis how regional migration and convergence are interrelated is performed on the basis of German districts within a period from 1995 to 2006. The concept of ß-convergence is applied and a cross-section model controlling for spatial correlation between the error terms is estimated. The results indicate convergence on the regional level; East German regions seem to catch up particularly fast. The effect of migration is twofold. Out-migration from poor region is correlated with strong growth in these regions. However, the corresponding migration towards richer region is accompanied with growth in these regions, too. Therefore, the impact of migration on convergence is uncertain. Nevertheless, the outcome is in favour of an aggregate benefit of migration if people move from poor to rich regions.

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Where enterprises lead, people follow? Links between migration and FDI in Germany

Claudia M. Buch J. Kleinert Farid Toubal

in: European Economic Review , No. 8, 2006


Standard neoclassical models of economic integration are based on the assumptions that capital and labor are substitutes and that the geography of factor market integration does not matter. Yet, these two assumptions are violated if agglomeration forces among factors from specific source countries are at work. Agglomeration implies that factors behave as complements and that the country of origin matters. This paper analyzes agglomeration between capital and labor empirically. We use state-level German data to answer the question whether and how migration and foreign direct investment (FDI) are linked. Stocks of inward FDI and of immigrants have similar determinants, and the geography of factor market integration matters. There are higher stocks of inward FDI in German states hosting a large foreign population from the same country of origin. This agglomeration effect is confined to higher-income source countries.

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Capital movements, migration and trade considering transaction costs

Michael Seifert

in: IWH Discussion Papers , No. 80, 1998

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