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Return Migrants and the Wage Premium: Does the Legal Status of Migrants Matter?

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  • Jackline Wahba

    () (University of Southampton)

  • Nelly El-Mallakh

Abstract

This paper examines the long-term impact of the legal status of overseas temporary migrants. Using unique data from Egypt, where we are able to distinguish between return migrants according to their type of international migration, documented versus undocumented migration, we examine the impact of temporary migration on their wages after return. Relying on a recursive mixed process model which takes into account the double selection into temporary migration and into the legal status of migrants, we examine the effect of illegal status on wages upon return. We find that undocumented migrants witness a wage penalty compared to documented migrants upon return. Our results also suggest that there is no wage penalty nor a wage premium for undocumented migrants compared to stayers. We also find suggestive evidence that undocumented migrants had lower-ranked occupations overseas and had lower earnings and lower savings overseas. Our results are the first to show the long term negative impact of undocumented migration on the migrant even after returning to their country of origin.

Suggested Citation

  • Jackline Wahba & Nelly El-Mallakh, 2017. "Return Migrants and the Wage Premium: Does the Legal Status of Migrants Matter?," Working Papers 1133, Economic Research Forum, revised 08 2017.
  • Handle: RePEc:erg:wpaper:1133
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    References listed on IDEAS

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    1. Bertoli, Simone & Marchetta, Francesca, 2015. "Bringing It All Back Home – Return Migration and Fertility Choices," World Development, Elsevier, vol. 65(C), pages 27-40.
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    7. Wahba, Jackline & Schluter, Christian, 2009. "Illegal migration, wages and remittances- semi-parametric estimation of illegality effects," Discussion Paper Series In Economics And Econometrics 913, Economics Division, School of Social Sciences, University of Southampton.
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    17. Ragui Assaad & Caroline Krafft, 2013. "The Egypt labor market panel survey: introducing the 2012 round," IZA Journal of Labor & Development, Springer;Forschungsinstitut zur Zukunft der Arbeit GmbH (IZA), vol. 2(1), pages 1-30, December.
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    19. Nelly El-Mallakh & Jackline Wahba, 2016. "Upward or Downward: Occupational Mobility and Return Migration," Working Papers 1010, Economic Research Forum, revised Jun 2016.
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