Israel

Effect of parental job loss on child school dropout. Evidence from the Occupied palestinian territories

We study the effect of parental job loss on child school dropout in developing countries. We focus on Palestinian households living in the Occupied Palestinian Territories and having the household head employed in Israel during the Second Intifada (2000–2006). We exploit quarterly variation in conflict intensity across districts in the OPT to instrument for Palestinian workers’ job loss in Israel. Our 2SLS results show that parental job loss increases child school dropout probability by 9 percentage points. The effect varies with child and household characteristics.

Security, trade, and political violence

This paper studies the effect of security-motivated trade restrictions on economic activity and political violence.We exploit the 2008 restrictions imposed by Israel on imports of selected goods to theWest Bank as a quasi-experiment. We show that after 2008 (i) output and wages decrease differentially in manufacturing sectors that use restricted materials more intensively as production inputs, (ii) wages decrease in localities where employment is more concentrated in these sectors, and (iii) episodes of political violence are more likely to occur in these localities.

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