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Echoes of the crises in Spain and US in the Colombian labor market: a differences-in-differences approach

Author

Listed:
  • Luis E. Arango

    ()

  • Dolores de la Mata

    ()

  • Nataly Obando

    ()

Abstract

This paper presents evidence of the effect of the recent phases of the business cycle in Spain and United States, proxied by their respective unemployment rates, on the labor market of Colombian cities with high migration tradition. These countries are the main destination for labor Colombian migrants. Using information from the household survey between 2006 and 2011 for urban areas in Colombia and a differences-in-differences approach we find that unemployment rates of those countries negatively affect the probability and the amount of remittances received by Colombian households living in areas with high and moderate migration tradition. At a second stage we provide evidence that unemployment rates of those countries positively affect the labor force participation decisions in Colombian regions with the highest migration tradition.

Suggested Citation

  • Luis E. Arango & Dolores de la Mata & Nataly Obando, 2014. "Echoes of the crises in Spain and US in the Colombian labor market: a differences-in-differences approach," Borradores de Economia 827, Banco de la Republica de Colombia.
  • Handle: RePEc:bdr:borrec:827
    as

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    References listed on IDEAS

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    1. Funkhouser, Edward, 1992. "Migration from Nicaragua: some recent evidence," World Development, Elsevier, vol. 20(8), pages 1209-1218, August.
    2. Ximena Cadena Ordóñez & Mauricio Cárdenas Santa María, 2004. "Las remesas en Colombia: costos de transacción y lavado de dinero," WORKING PAPERS SERIES. DOCUMENTOS DE TRABAJO 003127, FEDESARROLLO.
    3. Bussolo, Maurizio & Medvedev, Denis, 2008. "Do Remittances Have a Flip Side? A General Equilibrium Analysis of Remittances, Labor Supply Responses and Policy Options for Jamaica," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 23, pages 734-764.
    4. Maurizio Bussolo & María Soledad Martínez Peria & César Calderón & Yira Mascaró & Mette E. Nielsen & Pablo Acosta & J. Humberto López & Çaglar Özden & Yoko Niimi & Luis Molina & Florencia Moizeszowicz, 2008. "Remittances and Development: Lessons from Latin America," IDB Publications (Books), Inter-American Development Bank, number 59678 edited by J. Humberto López & Pablo Fajnzylber, February.
    5. Carlos Medina & Cristhian Manuel Posso, 2009. "Colombian and South American Immigrants in the United States of America: Education Levels, Job Qualifications and the Decision to Go Back Home," BORRADORES DE ECONOMIA 005758, BANCO DE LA REPÚBLICA.
    6. Calero, Carla & Bedi, Arjun S. & Sparrow, Robert, 2009. "Remittances, Liquidity Constraints and Human Capital Investments in Ecuador," World Development, Elsevier, vol. 37(6), pages 1143-1154, June.
    7. Pablo Fajnzylber & J. Humberto López, 2008. "Remittances and Development : Lessons from Latin America," World Bank Publications, The World Bank, number 6911, November.
    8. repec:idb:brikps:59678 is not listed on IDEAS
    9. Cox-Edwards, Alejandra & Rodríguez-Oreggia, Eduardo, 2009. "Remittances and Labor Force Participation in Mexico: An Analysis Using Propensity Score Matching," World Development, Elsevier, vol. 37(5), pages 1004-1014, May.
    10. Lina Cardona Sosa & Carlos Medina, 2006. "Migration as a Safety Net and Effects of Remittances on Household Consumption: The Case of Colombia," BORRADORES DE ECONOMIA 003219, BANCO DE LA REPÚBLICA.
    11. repec:bdr:bdrcap:2012-12-711-749 is not listed on IDEAS
    12. Arango-Thomas, Luis Eduardo & Montenegro, Paola & Obando, Nataly, 2012. "El desempleo en Pereira : ¿Solo cuestión de remesas?," Chapters,in: Arango-Thomas, Luis Eduardo & Hamann-Salcedo, Franz Alonso (ed.), El mercado de trabajo en Colombia : hechos, tendencias e instituciones, chapter 17, pages 711-749 Banco de la Republica de Colombia.
    13. Mauricio Cárdenas & Carlos Medina & Andrés Trejos, 2010. "Measuring Economic and Social Impacts of Migration in Colombia: New evidence," Borradores de Economia 601, Banco de la Republica de Colombia.
    14. Carlos Medina & Lina Cardona, 2010. "The Effects of Remittances on Household Consumption, Education Attendance and Living Standards: the Case of Colombia," Lecturas de Economía, Universidad de Antioquia, Departamento de Economía, issue 72, pages 11-44.
    15. Catalina Amuedo-Dorantes & Susan Pozo, 2006. "Remittances as insurance: evidence from Mexican immigrants," Journal of Population Economics, Springer;European Society for Population Economics, vol. 19(2), pages 227-254, June.
    16. Evans Jadotte, 2008. "Labor Supply Response to International Migration and Remittances in the Republic," Working Papers wpdea0808, Department of Applied Economics at Universitat Autonoma of Barcelona.
    17. Mora, J.J., 2013. "Gender differences between remittances and labor participation in developing countries: A cross-section analysis of Colombia in year 2008," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 13(1), pages 99-112.
    18. Bargain, Olivier & Boutin, Delphine, 2014. "Remittances and Child Labour in Africa: Evidence from Burkina Faso," IZA Discussion Papers 8007, Institute for the Study of Labor (IZA).
    19. Amuedo-Dorantes, Catalina & Pozo, Susan, 2010. "Accounting for Remittance and Migration Effects on Children's Schooling," World Development, Elsevier, vol. 38(12), pages 1747-1759, December.
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    Cited by:

    1. Leonardo Bonilla-Mejía, 2017. "Choques externos y remesas internacionales en las regiones de Colombia," Revista ESPE - Ensayos sobre Política Económica, Banco de la Republica de Colombia, vol. 35(84), pages 189-202, December.

    More about this item

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply

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