International Handbook on Migration and Economic Development
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International Handbook on Migration and Economic Development

Edited by Robert E.B. Lucas

This Handbook summarizes the state of thinking and presents new evidence on various links between international migration and economic development, with particular reference to lower-income countries. The connections between trade, aid and migration are critically examined through global case studies.
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Chapter 9: Emigration and wages in source countries: a survey of the empirical literature

Prachi Mishra


This chapter summarizes the emerging empirical literature on the effect of emigration on wages in a source country. The evidence can be broadly divided into four categories: (i) case studies, (ii) simulation exercises, (iii) studies using regional variation and finally, (iv) national level studies. Overall, a substantial body of the evidence points towards a strong and positive relationship between emigration and source country wages. Importantly, the effect has been found to be statistically and economically significant. The estimates from the national-level studies across a wide range of countries range from two percent to five and a half percent increase in wages owing to a 10 percent emigrant supply shock. The impact of emigration on wages has important implications in source countries, for wage inequality across schooling groups and for national income distribution between labor and other factors.

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