Does political conflict hurt immigration? Evidence from the South Korea–China THAAD dispute

We estimate the impact of political conflict on immigration using economic sanctions imposed by China on South Korea as a natural experiment. Due to the deployment of the Terminal High-Altitude Area Defense (THAAD) system in South Korea in 2016 (in cooperation with the United States), China started a series of retaliatory actions that could potentially hurt immigration by increasing anti-immigrant sentiment among Koreans. We use the synthetic control method and find no evidence suggesting a significant decline in the number of Chinese immigrants in South Korea. To explore the mechanism of this null effect, we also examine the impact of the dispute on attitudes toward China among Koreans and experiences of discrimination among Chinese people in South Korea. While negative perceptions of China greatly increased, experiences of discrimination did not increase. Taken together, this suggests that negative views of a country do not necessarily lead to a decrease in immigration from that country.