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The impact of emigration on source country wages : evidence from the Republic of Moldova

Author

Listed:
  • Bouton, Lawrence
  • Paul, Saumik
  • Tiongson, Erwin R.

Abstract

Thousands of Moldovans emigrated for work abroad over the last few years following nearly a decade of economic stagnation in their home country. At about 30 percent of the labor force, Moldova's emigrant population is in relative terms among the largest in the world. This study uses a unique household survey to examine the impact of emigration on wages in Moldova. The authors find a positive and significant impact of emigration on wages and the result is robust to the use of alternative samples and specifications. The size of the emigration coefficient varies depending on the sample and model specification, but the baseline result suggests that, on average, a 10 percent increase in the emigration rate is associated with 3.2 percent increase in wages. At the same time, there is evidence of significant differences across economic sectors in the estimated effect of emigration on wages. The authors speculate and provide some evidence that offsetting changes in labor demand, as revealed by information on employment growth by sector, may help explain some of the heterogeneity.

Suggested Citation

  • Bouton, Lawrence & Paul, Saumik & Tiongson, Erwin R., 2011. "The impact of emigration on source country wages : evidence from the Republic of Moldova," Policy Research Working Paper Series 5764, The World Bank.
  • Handle: RePEc:wbk:wbrwps:5764
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    References listed on IDEAS

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    1. Vijverberg, Wim P M, 1995. "Dual Selection Criteria with Multiple Alternatives: Migration, Work Status, and Wages," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 36(1), pages 159-185, February.
    2. Orrenius, Pia M. & Zavodny, Madeline, 2007. "Does immigration affect wages? A look at occupation-level evidence," Labour Economics, Elsevier, vol. 14(5), pages 757-773, October.
    3. Rachel M. Friedberg, 2001. "The Impact of Mass Migration on the Israeli Labor Market," The Quarterly Journal of Economics, Oxford University Press, vol. 116(4), pages 1373-1408.
    4. Abdurrahman Aydemir & George J. Borjas, 2007. "Cross-Country Variation in the Impact of International Migration: Canada, Mexico, and the United States," Journal of the European Economic Association, MIT Press, vol. 5(4), pages 663-708, June.
    5. Chiquiar, Daniel, 2005. "Why Mexico's regional income convergence broke down," Journal of Development Economics, Elsevier, vol. 77(1), pages 257-275, June.
    6. Mishra, Prachi, 2007. "Emigration and wages in source countries: Evidence from Mexico," Journal of Development Economics, Elsevier, vol. 82(1), pages 180-199, January.
    7. Robert E.B. Lucas, 2005. "International Migration and Economic Development," Books, Edward Elgar Publishing, number 3826, June.
    8. Robertson, Raymond, 2004. "Relative prices and wage inequality: evidence from Mexico," Journal of International Economics, Elsevier, vol. 64(2), pages 387-409, December.
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    Citations

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    Cited by:

    1. Anna De Paoli & Mariapia Mendola, 2014. "International Labor Mobility and Child Work in Developing Countries," Development Working Papers 365, Centro Studi Luca d'Agliano, University of Milano, revised 07 Apr 2014.
    2. Tamar Khitarishvili, 2016. "Gender Dimensions of Inequality in the Countries of Central Asia, South Caucasus, and Western CIS," Economics Working Paper Archive wp_858, Levy Economics Institute.
    3. repec:bla:worlde:v:40:y:2017:i:4:p:678-702 is not listed on IDEAS
    4. repec:eee:jmacro:v:52:y:2017:i:c:p:147-174 is not listed on IDEAS
    5. Amalia Cristescu & Maria Denisa Vasilescu & Larisa Stanila & Madalina Ecaterina Popescu, 2013. "Regional Analysis Of The Real Earnings In Romania," Romanian Journal of Regional Science, Romanian Regional Science Association, vol. 7(2), pages 58-78, DECEMBER.
    6. Benjamin Elsner, 2013. "Does emigration benefit the stayers? Evidence from EU enlargement," Journal of Population Economics, Springer;European Society for Population Economics, vol. 26(2), pages 531-553, April.
    7. Prachi Mishra & Antonio Spilimbergo, 2011. "Exchange Rates and Wages in an Integrated World," American Economic Journal: Macroeconomics, American Economic Association, vol. 3(4), pages 53-84, October.
    8. Anzelika Zaiceva, 2014. "Post-enlargement emigration and new EU members' labor markets," IZA World of Labor, Institute for the Study of Labor (IZA), pages 1-40, August.
    9. De Paoli, Anna & Mendola, Mariapia, 2014. "International Labor Mobility and Child Work in Developing Countries," IZA Discussion Papers 8066, Institute for the Study of Labor (IZA).
    10. Gagnon, Jason, 2010. "“Stay with Us”? The Impact of Emigration on Wages in Honduras," Proceedings of the German Development Economics Conference, Hannover 2010 57, Verein für Socialpolitik, Research Committee Development Economics.
    11. World Bank, "undated". "Europe and Central Asia Economic Update, October 2017," World Bank Other Operational Studies 28534, The World Bank.

    More about this item

    Keywords

    Labor Markets; Labor Policies; Population Policies; Voluntary and Involuntary Resettlement; Human Migrations&Resettlements;

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