The Social Capital Effects of Refugee Resettlement on Host Communities*

We examine the effects of refugee resettlement on the trust and attitudes of individuals in host populations. We exploit an exogenous resettlement shock in rural Australia and combine data from a lab‐in‐the‐field experiment with repeated cross‐sectional survey data to test the predictions of three prominent theories about inter‐group contact: contact theory, conflict theory and constrict theory. Surprisingly, our aggregate results reject all of the theories. A split‐sample analysis reveals strong gender effects: females who have experienced contact with resettled refugees are more trusting of refugees generally and also hold significantly more favourable attitudes towards refugee resettlement than males.