“How are children affected by abandonment?”

I think if you had the child since she was a baby, and essentially you are the parents that she’s known since she started having an awareness of his/her environment, and you raise her in a loving and supportive environment, that she should be fine. There are a lot of adopted children that grow up doing well with no issues.
But common issue of abandoned children is the attachment disorder.
I think if you raise the baby like your own and she or he is not transferred from one home to another, The baby will be fine.
Maybe the thing to watch out for is if your sister has a psychiatric disorder, that this may potentially be inherited by the child and will manifest at a certain age. Psychiatric disorders mostly have a genetic component to them especially mood anxiety psychotic and substance use disorders.

In many ways, however the most important part of it all is communication. Talk to her, ask her about her feelings and if you see any changes in behaviors along the way, you can take her ti a therapist or psychologist. But talk to her about it.

Anyone can be affected by abandonment. Severity and problems depend on circumstances, age, etc. Reactive attachment disorder can develop or other issues. If the child shows any changes in behavior or you have any concerns, the child should be evaluated by professional as early as possible to evaluate and start treatment if necessary.
I hope this helps.

Usually all children, if the abandonment occurred after bonding with the mother. If adopting parents step in and enable a quickly bonding positive relation, the destruction can largely be prevented. You don't mention any particular problem, so I assume this has been accomplished. In the long run, she will discover she was abandoned. At these ages the child often presumes it was her fault, that there must have been something wrong for her or the mother wouldn't have left. Several solutions have been suggested, depending on age & circumstance. Some foster parents would tell her she was adopted and that her parents were dead. Others might say that her parents were crazy and couldn't raise children, are in jail, & not allowed access to her, etc. The point being the older she is, when she learns all of this, the less psychological damage it will do. She will need a lot of love during his period to make her secure. You might start by reading up on "Attachment & Loss" to gain full comprehension of all of this. Start with Wikipedia. Don't be afraid to develop a consulting relationship with a psychologist or psychiatrist.
My hopes for the best outcome for all 3 of you!