The Economic Decision of International Migration: Two Empirical Evidences from the United States and Canada

This study investigated whether economic motivations are a key factor in international migration decisions. Applying the selectivity-corrected expected income for migrants and stayers, the difference in expected income for an individual in origin and destination countries was analyzed. This study used data from the U.S. and Canada to empirically test the role of income gaps in migration decisions. The main difficulty in analyzing the role of the gaps lies in collecting both income streams for the same individual, since once an individual migrates to a different country, their potential income in the origin country cannot be observed; and vice versa for stayers. Therefore, directly applying the average income of migrants (conditionally relying on their observed characteristics) to estimate the income of stayers if they had migrated results in a biased estimate of stayers’ income. Hence, there is a need to account for selectivity in the migration decision and calculate selectivity-corrected income. The key finding in this study is that the expected income gap is positively associated with, and statistically significant for, international migration decisions for the U.S. and Canada. One of the main reasons may be the easy transfer of labor skills between countries that have similar labor environments and cultural backgrounds.

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Publication Details

Journal
Economies
Published
2024-08-21
DOI
https://doi.org/10.3390/economies12080214
Citations
3
Primary Topic
Migration and Labor Dynamics
Type
article
Field-Weighted Citation Impact
3.40

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article

The Economic Decision of International Migration: Two Empirical Evidences from the United States and Canada

Jonghoon Park, SeongWoo Lee, Jiyoung Park
3 citations
Economies
Migration and Labor Dynamics
3.40
article

The Economic Decision of International Migration: Two Empirical Evidences from the United States and Canada

Jonghoon Park, SeongWoo Lee, Jiyoung Park
article en
3 citations

Abstract

This study investigated whether economic motivations are a key factor in international migration decisions. Applying the selectivity-corrected expected income for migrants and stayers, the difference in expected income for an individual in origin and destination countries was analyzed. This study used data from the U.S. and Canada to empirically test the role of income gaps in migration decisions. The main difficulty in analyzing the role of the gaps lies in collecting both income streams for the same individual, since once an individual migrates to a different country, their potential income in the origin country cannot be observed; and vice versa for stayers. Therefore, directly applying the average income of migrants (conditionally relying on their observed characteristics) to estimate the income of stayers if they had migrated results in a biased estimate of stayers’ income. Hence, there is a need to account for selectivity in the migration decision and calculate selectivity-corrected income. The key finding in this study is that the expected income gap is positively associated with, and statistically significant for, international migration decisions for the U.S. and Canada. One of the main reasons may be the easy transfer of labor skills between countries that have similar labor environments and cultural backgrounds.

EconomiesVol. 12(8)
Seoul National University (KR), Hanbat National University (KR), University at Buffalo, State University of New York (US)
Ministry of Environment
Reduced inequalities
Openalex Percentile: Top 7%
Migration and Labor Dynamics
3.40
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The Economic Decision of International Migration: Two Empirical Evidences from the United States and Canada — Jonghoon Park, SeongWoo Lee, et al. · Economies (2024) | TGRS Research Map | TGRS