This study examines the impact of refugee return on conflict dynamics by assessing the causal effect of a large-scale cash assistance program for Afghan returnees from Pakistan. Initiated due to the expiration of refugees’ Proof of Registration (PoR) cards in June 2016, the program doubled cash assistance for voluntary repatriates from $200 to $400, averaging $3600 per median returnee family. This amount was equivalent to a fighting season’s income for three recruitment-age males. The program ran from June 29 to December 7, 2016, before a winter break. Plans to extend the program in 2017 were halted due to budget shortfalls, reverting assistance to pre-program levels.
The authors identify the causal effect of assisted returns by leveraging the program’s quasi-random timing and historical returnee settlement patterns within a difference-in-differences framework. The key identifying assumption in their models is that districts hosting a larger share of documented returnees from Pakistan did not experience differential trends in insurgent or communal violence prior to the 2016 encashment program.
The analysis utilizes multiple data sources: (1) historical returnee settlement patterns from UNHCR-Afghanistan, including detailed data linking returnees’ settlements with their regions of origin; (2) individual-level data from the Asia Foundation’s Survey of Afghan Returnees (2018-2019); (3) combat records from the International Distributed Unified Reporting Environment (INDURE) cataloging insurgent and counterinsurgent engagements (2015-2017); (4) data on communal violence from a US government-sponsored conflict tracker (2016-2017); (5) data from the NATO-funded Afghanistan Quarterly Nationwide Assessment Research (ANQAR) survey on dispute resolution preferences; and (6) the location of districts under Taliban influence from ACSOR.
Main empirical findings:
- The program led to a significant increase in repatriation. The program led to an unparalleled scale of repatriation, with over 363,000 refugees, representing 66 percent of global documented returnees in 2016.
- Assisted returns caused a reduction in insurgent violence. The negative effect of assisted returns on insurgent violence suggests aid facilitated returnee reintegration and raised reservation wages, thereby reducing mobilization.
- Program-induced refugee returns increased communal violence. A one standard deviation increase in returnee exposure during the program raised the probability of communal violence by about 1 percent. Encashment beneficiaries reported worse relations with non-migrant neighbors, indicating that communal violence stemmed from animosity and resentment between repatriates and hosts.
- Policy-induced return caused insurgents to shift from labor-intensive combat to capital-intensive attacks, which require fewer recruits, thereby increasing the lethality of capital-intensive attacks. This shift is consistent with higher reservation wages, increasing the premium on part-time rebel mobilization.
- Program exposure reduced the rate of government success in neutralizing insurgent bombs, which are highly sensitive to civilian tips. This suggests that the economic benefits from assisted returns may have constrained counterinsurgent tip-buying by raising the price of information.
- Social capital and the quality of local institutions significantly mitigated the risks of communal violence due to refugee return. Communal violence increased where fewer returnees repatriated to their origin province or district and decreased where more returnees repatriated to their origin community. Return only sparked communal violence in areas with weaker local institutions (i.e., less reliance on shuras/elders or without Taliban control). In districts with strong informal dispute resolution mechanisms, return was negatively associated with social conflict.
The results indicate that refugee return is linked to an overall reduction and a shift in the composition of insurgent violence. Notably, the encashment program led to increased communal violence and heightened insurgent lethality, both of which are negative outcomes. The study provides evidence that the cash assistance program may have stimulated local economic activity in areas where returnees settled. As reservation wages rise and rebel capacity remains fixed, the production of labor-intensive violence becomes more costly. Furthermore, the market for collaboration responds to economic shocks; following the cash transfer program, there was a decline in bomb neutralizations, likely due to reduced information-sharing about the location of roadside bombs. However, social capital and preexisting kinship ties can moderate the potential for refugee repatriation to spark local conflicts. Additionally, legitimate local institutions for conflict mediation are crucial for ensuring safe refugee repatriation.