Crossing the border: Self-selection, earnings and individual migration decisions

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. www.econstor.eu Terms of use: Documents in D I S C U S S I O N P A P E R S E R I E S ABSTRACTCrossing the Border: Self-Selection, Earnings and Individual Migration Decisions * Many empirical studies on the determinants of international migration flows rely exclusively on macro data, and do not account for migrants' self-selection. We analyze a very interesting episode in international migration for which we are able to gather individual-level data covering all relevant countries, namely the exodus of Ecuadorians to Spain and the US in the aftermath of the economic collapse of 1999. Specifically, we produce selection-corrected predictions of counterfactual individual earnings and use them to estimate a discrete-choice migration equation that allows for correlated errors across destinations and a rich structure of migration costs. We find that earnings significantly shape individual migration decisions, even in an episode in which Ecuadorians mostly chose Spain where earnings were lower than in the US, and they contribute to explaining the observed composition of migration flows. Moreover, our estimates show that changes in earnings at a particular destination have a larger effect on destination choice conditional on migration than on the scale of migration. JEL Classification:F22, O15, J61, D33

Multilateral resistance to migration

“…Fourth, the paper is related to the contributions in the econometric literature that present estimators which allow to deal with violations on the classical assumption about the variance 8 This huge effect is in line with the findings of Bertoli, Fernández-Huertas Moraga, and Ortega (2011) for the case of Ecuadorian migration to Spain. 9 The analysis is also related to the papers that estimate the influence of demographic factors (Hanson and McIntosh, 2010b,a) and migration networks (Edin, Fredriksson, andÅslund, 2003;Munshi, 2003;McKenzie and Rapoport, 2010;Bertoli, 2010) upon migration flows; these effects are controlled for but not estimated in our paper.…”

“…Furthermore, we have compiled information about the various facets of Spanish immigration policies -such as bilateral visa waivers and agreements on the portability of pension rights -which have been shown to be relevant determinants of recent immigration to Spain (Bertoli, Fernández-Huertas Moraga, and Ortega, 2011).…”

“…Visa policies -which can exert a substantial influence on the scale of bilateral migration flows (Bertoli, Fernández-Huertas Moraga, and Ortega, 2011) -can be coordinated at the supranational level. For instance, the list of third countries whose nationals need a visa to enter the European Union is determined by the European Council: when a country is included in this list, a simultaneous change in the bilateral visa policies towards this country adopted by EU member states is observed.…”

“…1 Bertoli, Fernández-Huertas Moraga, and Ortega (2010) analyze the income-sensitivity of international migration flows using individual-level data.…”

Does Foreign Language Proficiency Foster Migration of Young Individuals within the European Union?

“…Differences in wages are commonly included in estimations of internal migration decisions -see Kennan and Walker [2011] for the United States. In estimations of cross-country migration, the use of wage differentials has been limited due to problems of data availability; one exception is Bertoli et al [2013] who consider migration from Ecuador to Spain and to the United States. The distance between two countries, on the other hand, is often measured by the geographic distance, a lack of common borders, lack of a common language, and linguistic distance.…”