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The Long-Term Impact of International Migration on Economic Decision-Making: Evidence from a Migration Lottery and Lab-in-the-Field Experiments

John Gibson (), David McKenzie (), Halahingano Rohorua () and Steven Stillman ()
Additional contact information
Halahingano Rohorua: University of Waikato

No 10110, IZA Discussion Papers from Institute for the Study of Labor (IZA)

Abstract: We study how migration from a poor to a rich country affects key economic beliefs, preference parameters, and transnational household decision-making efficiency. Our setting is the migration of Tongans to New Zealand through a migration lottery program. In a ten-year follow-up survey of individuals applying for this program we elicit risk and time preferences and pro-market beliefs. We also link migrants and potential migrants to a partner household consisting of family members who would stay behind if they moved. We play lab-in-the-field games designed to measure the degree of intra-family trust and the efficiency of intra-family decision-making. Migration provides a large and permanent positive shock to income, a large change in economic institutions, and a reduction in interactions with partner household members. Despite these changes, we find no significant impacts of migration on risk and time preferences, pro-market beliefs, or in the decision-making efficiency of transnational households. This stability in the face of such a large and life-changing event lends credence to economic models of migration that treat these determinants of decision-making as time-invariant, and contrasts with recent evidence on preference changes after negative shocks.

Keywords: migration; economic beliefs; preferences; household efficiency; transnational household (search for similar items in EconPapers)
JEL-codes: O12 F22 D13 D81 P1 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cse and nep-mig
Date: 2016-07
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Related works:
Journal Article: The long-term impact of international migration on economic decision-making: Evidence from a migration lottery and lab-in-the-field experiments (2019) Downloads
Working Paper: The Long-Term Impact of International Migration on Economic Decision-Making: Evidence from a Migration Lottery and Lab-in-the-Field Experiments (2016) Downloads
Working Paper: The long-term impact of international migration on economic decision-making: evidence from a migration lottery and lab-in-the-field experiments (2016) Downloads
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