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Why Do Migrants Return to Poor Countries? Evidence From Philippine Migrants%u2019 Responses to Exchange Rate Shocks

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  • Dean Yang

Abstract

This paper distinguishes between target-earnings and life-cycle motivations for return migration by examining how Philippine migrants%u2019 return decisions respond to major, unexpected exchange rate changes in their overseas locations (due to the Asian financial crisis). Overall, the evidence favors the life-cycle explanation: more favorable exchange rate shocks lead to fewer migrant returns. A 10% improvement in the exchange rate reduces the 12-month return rate by 1.4 percentage points. However, some migrants appear motivated by target-earnings considerations: in households with intermediate foreign earnings, favorable exchange rate shocks have the least effect on return migration, but lead to increases in household investment.

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Bibliographic Info

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 12396.

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Date of creation: Jul 2006
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Publication status: published as Yang, Dean. "Why Do Immigrants Return To Poor Countries? Evidence From Philippine Migrants' Responses To Exchange Rate Shocks," Review of Economics and Statistics, 2006, v88(4,Nov), 715-735.
Handle: RePEc:nbr:nberwo:12396

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Citations

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Cited by:
  1. Mishra, Prachi & Spilimbergo, Antonio, 2009. "Exchange Rates and Wages in an Integrated World," CEPR Discussion Papers, C.E.P.R. Discussion Papers 7167, C.E.P.R. Discussion Papers.
  2. Bijwaard, Govert E. & Wahba, Jackline, 2014. "Do high-income or low-income immigrants leave faster?," Journal of Development Economics, Elsevier, Elsevier, vol. 108(C), pages 54-68.
  3. Jeffrey Grogger & Gordon H. Hanson, 2008. "Income Maximization and the Selection and Sorting of International Migrants," NBER Working Papers 13821, National Bureau of Economic Research, Inc.
  4. Seshan, Ganesh & Yang, Dean, 2014. "Motivating migrants: A field experiment on financial decision-making in transnational households," Journal of Development Economics, Elsevier, Elsevier, vol. 108(C), pages 119-127.
  5. Blanchflower, David G. & Lawton, Helen, 2008. "The Impact of the Recent Expansion of the EU on the UK Labour Market," IZA Discussion Papers 3695, Institute for the Study of Labor (IZA).
  6. KIrdar, Murat G., 2009. "Labor market outcomes, savings accumulation, and return migration," Labour Economics, Elsevier, Elsevier, vol. 16(4), pages 418-428, August.
  7. Catalina Amuedo-Dorantes & Kusum Mundra, 2010. "Legalization and Immigrant Homeownership: Evidence from Spain," Working Papers Rutgers University, Newark, Department of Economics, Rutgers University, Newark 2010-005, Department of Economics, Rutgers University, Newark.
  8. Renata Ivanova & Byeongju Jeong, 2011. "Why Don't Migrants with Secondary Education Return?," CERGE-EI Working Papers wp449, The Center for Economic Research and Graduate Education - Economic Institute, Prague.
  9. Gordon H. Hanson, 2009. "The Economic Consequences of the International Migration of Labor," Annual Review of Economics, Annual Reviews, Annual Reviews, vol. 1(1), pages 179-208, 05.
  10. Albert Park & Dean Yang & Xinzheng Shi & Yuan Jiang, 2009. "Exporting and Firm Performance: Chinese Exporters and the Asian Financial Crisis," NBER Working Papers 14632, National Bureau of Economic Research, Inc.
  11. Mezger Kveder, Cora Leonie & Flahaux, Marie-Laurence, 2013. "Returning to Dakar: A Mixed Methods Analysis of the Role of Migration Experience for Occupational Status," World Development, Elsevier, Elsevier, vol. 45(C), pages 223-238.
  12. Marcin Holda & Katarzyna Saczuk & Pawel Strzelecki & Robert Wyszynski, 2011. "Settlers and Guests - Determinants of the Plans of Return Migration from UK and Ireland to Poland in the Period 2007-2009," National Bank of Poland Working Papers, National Bank of Poland, Economic Institute 84, National Bank of Poland, Economic Institute.

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