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

No 7848, Policy Research Working Paper Series from The World Bank

Abstract: This paper studies how migration from a poor to a rich country affects key economic beliefs, preference parameters, and transnational household decision-making efficiency. The setting is the migration of Tongans to New Zealand through a migration lottery program. In a 10-year follow-up survey of individuals applying for this program, the study elicited risk and time preferences and pro-market beliefs. It also linked migrants and potential migrants to a partner household consisting of family members who would stay behind if the migrants moved. Survey participants played 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, the study finds no significant impacts of migration on risk and time preferences, pro-market beliefs, or 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.

Date: 2016-10-03
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Citations: View citations in EconPapers (4)

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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)
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)
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)
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