Emigration, Wages, and Agricultural Transformation in Myanmar’s Mon State

As it emerges from decades of military rule and international economic sanctions, the country of Myanmar ranks among the least advanced economies on the South-East Asian peninsula. Low wages and lack of prospects have long prompted the Burmese to seek income opportunities in neighboring countries, but this outflow of labor force has greatly intensified over the past decade. In the migrant-sending economy, this can result in significant labormarket pressures which raise wages and erode farmer profits. Using primary household data from Mon State, a southern state neighboring Thailand, we provide insights into these phenomena. We document the extent of migration flows, finding that almost a third of the labor force of Mon State is currently away (mostly in Thailand). Regression estimates reveal a significant relationship between migration and wage levels. We use past propensity to migrate as an instrument for current migration to demonstrate that the relationship between migration and high wages is causal. Finally, we further apply this methodology to explore the relationship between migration and changes in agricultural practices, and find that migration is prompting farmers to abandon labor-intensive technologies, thus precipitating transformation in the rural economy of Mon State.