Abundance from Abroad: Migrant Income and Long-Run Economic Development

Gaurav Khanna, Emir Murathanoglu, Caroline Theoharides and Dean Yang

No 29862, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We study how international migrant income prospects affect long-run development in origin areas. We leverage the 1997 Asian Financial Crisis exchange rate shocks in a shift-share identification strategy across Philippine provinces. Initial migrant income shocks are magnified six-fold over time, increasing domestic income, education levels, migrant skills, and high-skilled migration. Remarkably, 73.6% of long-run income gains come from domestic rather than migrant income. Trade-driven impacts of exchange rate shocks are orthogonal to effects via migrant income. A structural model reveals that 19.6% of long-run income gains stem from educational investments. International migration fosters broad economic development in origin communities.

JEL-codes: F22 J24 O15 O16 (search for similar items in EconPapers)
Date: 2022-03
New Economics Papers: this item is included in nep-fdg, nep-int, nep-lma, nep-mig, nep-sea and nep-ure
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