The Effect of Social Networks on Labour Market Outcome among Migrants in Vietnam

Type Working Paper
Title The Effect of Social Networks on Labour Market Outcome among Migrants in Vietnam
Author(s)
Publication (Day/Month/Year) 2016
URL http://conference.iza.org/conference_files/worldb2011/hoang_v6821.pdf
Abstract
This paper examines the labour market outcome of migrants in a developing country of
Vietnam with respect to the role of social networks and other human capital on the job search
duration and earnings using the 2004 Vietnam Internal Migration Survey. The findings
contribute to the growing literature of the labour market outcome of migrants in the
developing world. The main findings are: those migrants who have spouse and family
members spend longer time on initial unemployment, enjoy higher wage, and are more likely
to work in the informal sector. In regards to having friends or countrymen at the destination,
we find that this type of social network has positive and significant effect for all migrant
groups. This indicates that friends/countrymen are source of information of the work
opportunity in at the destination for the potential migrants. Furthermore, having friends and
countrymen shorten the job search for formal jobs for rural to urban migrants, while this
channel has no effect among urban to urban migrants. This paper extends the current
literature by distinguishing the formal versus informal jobs and among the first to study
labour market outcome of migrants in a developing country.

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