IDEAS home Printed from https://ideas.repec.org/a/aea/aecrev/v116y2026i4p1540-77.html

Abundance from Abroad: Migrant Income and Long-Run Economic Development

Author

Listed:
  • Gaurav Khanna
  • Emir Murathanoglu
  • Caroline Theoharides
  • Dean Yang

Abstract

We study how international migrant income prospects affect long-run development in origin areas. We leverage the 1997 Asian Financial Crisis exchange rate shocks in a shift-share identification strategy across Philippine provinces. Initial migrant income shocks are magnified six-fold over time, increasing domestic income, education levels, migrant skills, and high-skilled migration. Remarkably, 74.9 percent of long-run income gains come from domestic rather than migrant income. Trade driven impacts of exchange rate shocks are orthogonal to effects via migrant income. A structural model reveals that 19.7 percent of long-run income gains stem from educational investments. International migration fosters broad economic development in origin communities.

Suggested Citation

  • Gaurav Khanna & Emir Murathanoglu & Caroline Theoharides & Dean Yang, 2026. "Abundance from Abroad: Migrant Income and Long-Run Economic Development," American Economic Review, American Economic Association, vol. 116(4), pages 1540-1577, April.
    • Handle: RePEc:aea:aecrev:v:116:y:2026:i:4:p:1540-77
    DOI: 10.1257/aer.20241465
    as

    Download full text from publisher

    File URL: https://www.aeaweb.org/doi/10.1257/aer.20241465
    Download Restriction: Access to full text is restricted to AEA members and institutional subscribers.
    File URL: https://doi.org/10.3886/E239001V1
    Download Restriction: no
    File URL: https://www.aeaweb.org/articles/materials/24912
    Download Restriction: no
    File URL: https://www.aeaweb.org/articles/materials/24913
    Download Restriction: no
    File URL: https://libkey.io/10.1257/aer.20241465?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or

    for a different version of it.

    Other versions of this item:

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Caballero, María Esther & Cadena, Brian C. & Kovak, Brian K., 2023. "The international transmission of local economic shocks through migrant networks," Journal of International Economics, Elsevier, vol. 145(C).
    2. Batista, Catia & Costa, David M. & Freitas, Pedro & Lima, Gonçalo & Reis, Ana B., 2025. "What matters for the decision to study abroad? A lab-in-the-field experiment in Cape Verde," Journal of Development Economics, Elsevier, vol. 173(C).
    3. Dodini, Samuel & Lundborg, Petter & Løken, Katrine & Willén, Alexander, 2025. "The Fatal Consequences of Brain Drain," Discussion Paper Series in Economics 9/2025, Norwegian School of Economics, Department of Economics.
    4. Philippe BOCQUIER & Narcisse CHA’NGOM & Frédéric DOQUIER & Joël MACHADO, 2024. "The within-country distribution of brain drain and brain gain effects: A case study on Senegal," JODE - Journal of Demographic Economics, Cambridge University Press, vol. 90(3), pages 384-411, September.
    5. Maertens,Annemie & Siddharth Sharma & Khamis,Melanie, 2024. "Absentee Landlords and Land Tenancy," Policy Research Working Paper Series 10865, The World Bank.
    6. Narcisse Cha'ngom & Christoph Deuster & Frédéric Docquier & Joël Machado, 2025. "Selective Migration and Economic Development: A Generalized Approach," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 66(4), pages 1713-1732, October.
    7. Kpodar, Kangni & Amir Imam, Patrick, 2024. "How do transaction costs influence remittances?," World Development, Elsevier, vol. 177(C).
    8. De Arcangelis, Giuseppe & Fertig, Alexander & Liang, Yuna & Srouji, Peter & Yang, Dean, 2023. "Measuring remittances," Journal of Development Economics, Elsevier, vol. 161(C).
    9. Bossavie, Laurent & Görlach, Joseph-Simon & Özden, Çaglar & Wang, He, 2025. "Temporary migration for long-term investment," Journal of Development Economics, Elsevier, vol. 174(C).
    10. Christian Dustmann & Hyejin Ku & Tetyana Surovtseva, 2024. "Real Exchange Rates and the Earnings of Immigrants," The Economic Journal, Royal Economic Society, vol. 134(657), pages 271-294.
    11. Cinque, Andrea & Gehrke, Esther & Reiners, Lennart, 2026. "Confined to stay: Migration restrictions, natural disasters, and poverty," Journal of Development Economics, Elsevier, vol. 178(C).
    12. Catia Batista & Lara Bohnet & Jules Gazeaud & Julia Seither, 2025. "From destination to origin: experimental evidence on the international spillovers of migrant integration," Nova SBE Working Paper Series wp2503, Universidade Nova de Lisboa, Nova School of Business and Economics.

    More about this item

    JEL classification:

    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • F31 - International Economics - - International Finance - - - Foreign Exchange
    • G01 - Financial Economics - - General - - - Financial Crises
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J82 - Labor and Demographic Economics - - Labor Standards - - - Labor Force Composition
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aea:aecrev:v:116:y:2026:i:4:p:1540-77. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Michael P. Albert (email available below). General contact details of provider: https://edirc.repec.org/data/aeaaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.