Central Data Catalog

Citation Information

Type Working Paper
Title Split Decisions: Household Finance When a Policy Discontinuity Allocates Overseas Work
Publication (Day/Month/Year) 2014
URL http://cgdev.org.488elwb02.blackmesh.com/sites/default/files/clemens-tiongson-split-decisions-revise​d.pdf
Overseas work can raise a family’s income but also split the household geographically, with theoretically ambiguous net effects on decisions about work, investment, and education. We study a policy discontinuity in the Philippines that resulted in quasirandom assignment of temporary, partial-household migration to high-wage jobs in Korea. This allows quasi-experimental estimates of reduced-form effects on migrant households’ spending, saving, borrowing, business income, and investment in children. A purpose-built survey allows nonexperimental tests of different mechanisms for the effect. These suggest that an important channel — beyond remittance income — involves changes in household decision-making power when migration separates married couples. We find no evidence that migration affects labor force participation by non-migrant family members.

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