Effects of emigration on labor markets in migrant origin areas: Evidence from internal migration in Indonesia
利用印度尼西亚27年追踪数据，发现内部移民率每提高1个百分点，原籍地留守者小时收入增加3.42%，且低技能者通过转向正规部门获益最大。
We study the effects of internal migration in Indonesia on labor market outcomes of non-migrants in origin areas. To address endogeneity of the decision to migrate, we instrument emigration rates with shift-share labor demand shocks in destination areas interacted with historical migration patterns. Using detailed longitudinal data from over 36,000 individuals, whom we observe over a 27-year period, we find that a one percentage point increase in the emigration rate leads to a 3.42% increase in hourly income for those who stay in origin areas. Given the high degree of informality in Indonesia, we then look separately at effects for formal- and informal-sector workers. In line with a dual-sector labor market model, we find that employment effects are concentrated in the formal sector and income effects are most pronounced in the informal sector. Even though emigrants tend to be higher-educated, lower-educated non-migrants benefit the most as they switch to formal sector work and benefit from higher earnings in the informal sector.