Ethnic Conflict and Job Separations*
Ethnic Conflict and Job Separations∗ Sami Miaari Asaf Zussman† Noam Zussman Israeli Central Bureau of Statistics Hebrew University Bank of Israel October 27, 2009 Abstract We study the effect of the second Intifada, a violent conflict between Israel and its Palestinian neighbors which erupted in September 2000, and the ensuing riots of Arab citizens of Israel, on labor market outcomes of Arabs relative to those of Jewish Israelis. The analysis relies on a large matched employer-employee dataset, focusing on firms that in the pre-Intifada period hired both Arabs and Jews. Our analysis demonstrates that until September 2000 Arab workers had a lower rate of job separation than their Jewish peers and that this differential was significantly reduced after the outbreak of the Intifada. We argue that the most likely explanation for this pattern is increased anti-Arab discrimination among Jews. JEL classification codes: H56, J15, J63, J71 Keywords: Ethnic Conflict, Job Separation, Israel, Arabs, Intifada ∗We are indebted to John Abowd, David Genesove, Luigi Guiso, Victor Lavy, Ramon Marimon, Daniele Paserman, Robert Sauer, Eytan Sheshinski, Françoise Vermeylen, Amos Zehavi and participants of presentations at the Bank of Israel, Ben Gurion University, the European Economic Association Meeting 2009, the European University Institute, the Israeli Economic Association Meeting 2008, the Israeli National Economic Council, Haifa University, Hebrew University (economics department and law school), the London School of Economics, and Tel Aviv University for useful advice. The paper is based on data analysis conducted at the facilities of the Israeli Central Bureau of Statistics using files prepared by Orly Furman of the Bureau’s Chief Scientist Department.
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