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Labor market outcomes, savings accumulation, and return migration

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  • KIrdar, Murat G.

Abstract

In this paper, I examine the determinants of return migration from Germany for immigrants from four different source countries, and test the savings accumulation conjecture that is used to rationalize return migration decisions using both cross-country and time variation in purchasing power parity. The empirical results confirm the savings accumulation conjecture. Therefore, return migration can be seen as part of optimal life-cycle location choices in this context. I also examine how labor market outcomes influence return decisions. A key finding here is that unlike previous studies, which find a positive impact of unemployment on return migration, I find that the direction of the impact of unemployment changes by the spell length.

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Bibliographic Info

Article provided by Elsevier in its journal Labour Economics.

Volume (Year): 16 (2009)
Issue (Month): 4 (August)
Pages: 418-428

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Handle: RePEc:eee:labeco:v:16:y:2009:i:4:p:418-428

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Web page: http://www.elsevier.com/locate/labeco

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Keywords: International migration Savings accumulation Unemployment Duration analysis;

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References

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  1. Dustmann, Christian, 2003. "Return migration, wage differentials, and the optimal migration duration," European Economic Review, Elsevier, vol. 47(2), pages 353-369, April.
  2. Abdurrahman Aydemir & Chris Robinson, 2006. "Global Labour Markets, Return and Onward Migration," University of Western Ontario, CIBC Centre for Human Capital and Productivity Working Papers 20061, University of Western Ontario, CIBC Centre for Human Capital and Productivity.
  3. Axel Borsch-Supan & Reinhold Schnabel, 1999. "Social Security and Retirement in Germany," NBER Chapters, in: Social Security and Retirement around the World, pages 135-180 National Bureau of Economic Research, Inc.
  4. Marianne Bertrand & Esther Duflo & Sendhil Mullainathan, 2004. "How Much Should We Trust Differences-in-Differences Estimates?," The Quarterly Journal of Economics, MIT Press, vol. 119(1), pages 249-275, February.
  5. A. Colin Cameron & Jonah B. Gelbach & Douglas L. Miller, 2007. "Bootstrap-Based Improvements for Inference with Clustered Errors," NBER Technical Working Papers 0344, National Bureau of Economic Research, Inc.
  6. Hill, John K., 1987. "Immigrant decisions concerning duration of stay and migratory frequency," Journal of Development Economics, Elsevier, vol. 25(1), pages 221-234, February.
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  8. Patricia Reagan & Randall Olsen, 2000. "You can go home again: Evidence from longitudinal data," Demography, Springer, vol. 37(3), pages 339-350, August.
  9. Dustmann, Christian & Kirchkamp, Oliver, 2000. "The Optimal Migration Duration and Activity Choice after Re-migration," Sonderforschungsbereich 504 Publications 00-39, Sonderforschungsbereich 504, Universität Mannheim;Sonderforschungsbereich 504, University of Mannheim.
  10. Stark, Oded & Helmenstein, Christian & Yegorov, Yuri, 1997. "Migrants' Savings, Purchasing Power Parity, and the Optimal Duration of Migration," Economics Series 44, Institute for Advanced Studies.
  11. Djajic, Slobodan, 1989. "Migrants in a guest-worker system : A utility maximizing approach," Journal of Development Economics, Elsevier, vol. 31(2), pages 327-339, October.
  12. Dean Yang, 2006. "Why Do Migrants Return to Poor Countries? Evidence from Philippine Migrants' Responses to Exchange Rate Shocks," The Review of Economics and Statistics, MIT Press, vol. 88(4), pages 715-735, November.
  13. George J. Borjas, 1994. "The Economics of Immigration," Journal of Economic Literature, American Economic Association, vol. 32(4), pages 1667-1717, December.
  14. Amelie Constant & Douglas S. Massey, 2003. "Self-selection, earnings, and out-migration: A longitudinal study of immigrants to Germany," Journal of Population Economics, Springer, vol. 16(4), pages 631-653, November.
  15. Guillermina Jasso & Mark Rosenzweig, 1982. "Estimating the emigration rates of legal immigrants using administrative and survey data: The 1971 cohort of immigrants to the United States," Demography, Springer, vol. 19(3), pages 279-290, August.
  16. Dean Yang, 2006. "Why Do Migrants Return to Poor Countries? Evidence From Philippine Migrants%u2019 Responses to Exchange Rate Shocks," NBER Working Papers 12396, National Bureau of Economic Research, Inc.
  17. Klaus F. Zimmermann, 1995. "Tackling the European Migration Problems," Journal of Economic Perspectives, American Economic Association, vol. 9(2), pages 45-62, Spring.
  18. Kumcu, M. Ercan, 1989. "The savings behavior of migrant workers : Turkish workers in W. Germany," Journal of Development Economics, Elsevier, vol. 30(2), pages 273-286, April.
  19. Dustmann, Christian, 1997. "Return migration, uncertainty and precautionary savings," Journal of Development Economics, Elsevier, vol. 52(2), pages 295-316, April.
  20. Bellemare, C., 2003. "Economic Assimilation and Outmigration of Immigrants in West-Germany," Discussion Paper 2003-65, Tilburg University, Center for Economic Research.
  21. Alice Mesnard, 2004. "Temporary migration and capital market imperfections," Oxford Economic Papers, Oxford University Press, vol. 56(2), pages 242-262, April.
  22. Borjas, George J, 1989. "Immigrant and Emigrant Earnings: A Longitudinal Study," Economic Inquiry, Western Economic Association International, vol. 27(1), pages 21-37, January.
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Cited by:
  1. Kirdar, Murat G., 2010. "Estimating the Impact of Immigrants on the Host Country Social Security System When Return Migration is an Endogenous Choice," IZA Discussion Papers 4894, Institute for the Study of Labor (IZA).
  2. Strom, Steinar & Venturini, Alessandra & Villosio, Claudia, 2013. "Wage Assimilation: Migrants versus Natives and Foreign Migrants versus Internal Migrants," Department of Economics and Statistics Cognetti de Martiis. Working Papers 201341, University of Turin.
  3. Kirdar, Murat, 2009. "Source Country Characteristics and Immigrants’ Migration Duration and Saving Decisions," MPRA Paper 13322, University Library of Munich, Germany.
  4. Bijwaard, Govert & Schluter, Christian & Wahba, Jackline, 2011. "The Impact of Labour Market Dynamics on the Return-Migration of Immigrants," IZA Discussion Papers 5722, Institute for the Study of Labor (IZA).
  5. Bijwaard, Govert & Wang, Qi, 2013. "Return Migration of Foreign Students," IZA Discussion Papers 7185, Institute for the Study of Labor (IZA).
  6. Govert E. Bijwaard & Christian Schluter & Jackline Wahba, 2012. "The Impact of Labour Market Dynamics on the Return–Migration of Immigrants," CReAM Discussion Paper Series 1227, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
  7. Christian Dustmann, 2014. "Selective Outmigration and the Estimation of Immigrants Earnings Profiles," CReAM Discussion Paper Series 1402, Centre for Research and Analysis of Migration (CReAM), Department of Economics, University College London.
  8. Hulya Ulku, 2010. "Remitting Behaviour of Turkish Migrants: Evidence from Household Data in Germany," Brooks World Poverty Institute Working Paper Series 11510, BWPI, The University of Manchester.

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