Distortions in the International Migrant Labor Market: Evidence from Filipino Migration and Wage Responses to Destination Country Economic Shocks

David McKenzie, Caroline Theoharides and Dean Yang

No 6498, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We use an original panel dataset of migrant departures from the Philippines to identify the responsiveness of migrant numbers and wages to GDP shocks in destination countries. We find a large significant elasticity of migrant numbers to GDP shocks at destination, but no significant wage response. This is consistent with binding minimum wages for migrant labor. This result implies that labor market imperfections that make international migration attractive also make migrant flows more sensitive to global business cycles. Difference-in-differences analysis of a minimum wage change for maids confirms that minimum wages bind and demand is price sensitive without these distortions.

Keywords: international migration; migrant demand; labor output elasticity; minimum wages (search for similar items in EconPapers)
JEL-codes: F22 J23 O12 (search for similar items in EconPapers)
Pages: 41 pages
Date: 2012-04
New Economics Papers: this item is included in nep-dev, nep-lab and nep-mig
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

Published - published in: American Economic Journal: Applied Economics, 2014, 6(2), 49-75.

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Related works:
Journal Article: Distortions in the International Migrant Labor Market: Evidence from Filipino Migration and Wage Responses to Destination Country Economic Shocks (2014)
Working Paper: Distortions in the International Migrant Labor Market: Evidence from Filipino Migration and Wage Responses to Destination Country Economic Shocks (2012)
Working Paper: Distortions in the international migrant labor market:evidence from Filipino migration and wage responses to destination country economic shocks (2012)
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