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Permanent Migration and Remittances in Ethiopia<br />June 24, 2010<br />Alan de Brauw<br />Lisa Moorman<br />Valerie Muell...
Urbanization Trends for SSA<br />2<br />
Some urbanization is good<br />Geographic concentration of labor conducive for agglomeration economies and growth<br />Mor...
Relevant policies<br />National Population Policy (1993)<br /> discourages rural urban migration because excessive it can ...
Registration process inhibits RU migration<br />You need to stay 6 months before you register as urban dweller<br />This m...
Migration benefits people<br />Releases resources for hh members <br />Creates additional employment opportunities<br />Ad...
Research Gaps<br />Very few migration studies on Ethiopia<br />Migration behavior not well understood<br />Data to analyze...
Objectives<br />Migration patterns out of 18 kebeles<br />Matching migrant and hh panel to examine<br />Determinants of mi...
Matched Sample<br />Ethiopian Rural Household Survey (ERHS) <br />Focus on 2004-5 and 2009 rounds (18 kebeles)<br />Tracki...
10<br />
11<br />Source: Schmidt and Kedir (2009)<br />
12<br />
Migration by Destination Type<br />13<br />
Rural-to-rural migration most common<br />Partially explains why urbanization is low<br />Has implications on determinants...
15<br />
Migrant’s Characteristics<br />16<br />
Occupations of Migrants<br />17<br />
Household Head Characteristics by Migration Status<br />18<br />Source: ERHS, 2004-5<br />
Determinants of Migration<br />Wage differential<br />Migrant Networks<br />Capital market imperfections<br />Land scarcit...
Land Scarcity and Rights<br />20<br />Source: Migrant Tracking Survey, 2009<br />
Risk<br />21<br />Source: Migrant Tracking Survey, 2009; ERHS, 2009<br />
Household Shock Exposure by Migration Status<br />22<br />Source: ERHS, 2009<br />
Empirical Model<br />23<br />X: female headship, age, occupation, literacy, ethnicity, support network outside of village,...
Migration Probability Results<br />24<br />RR: rural-rural      RU: rural-urban<br />1: Defines urban as woreda with >50,0...
Welfare Implications of Migration<br />Channels of welfare benefits<br />Auxiliary income through remittances<br />Additio...
Remittances<br />Generally remittance rate of internal migrants is lower than rate of international migrants<br />Africa t...
27<br />Household Food Scarcity by Migration Status over Time (ERHS)<br />
Comparing Consumption of Migrants versus Source Households (2009)<br />28<br />
Comparing Consumption Changes of Migrants<br />29<br />
Changes in Subjective Well-being<br />30<br />
Discussion<br />Migration low and predominantly rural-rural<br />agglomeration economies and future growth?<br />provision...
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Permanent Migration and Remittances in Ethiopia

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Ethiopian Development Research Institute (EDRI) and International Food Policy Research Institute (IFPRI), Seventh International Conference on Ethiopian Economy, June 24, 2010

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Permanent Migration and Remittances in Ethiopia

  1. 1. Permanent Migration and Remittances in Ethiopia<br />June 24, 2010<br />Alan de Brauw<br />Lisa Moorman<br />Valerie Mueller<br />Tassew Woldehanna<br />1<br />
  2. 2. Urbanization Trends for SSA<br />2<br />
  3. 3. Some urbanization is good<br />Geographic concentration of labor conducive for agglomeration economies and growth<br />More effective to provide services in areas concentrated with people (e.g., sanitation, health, electricity, infrastructure) <br />More cost-effective<br />Easier for citizens to access<br />Migration into urban areas may be too low, and we want to understand why<br />3<br />
  4. 4. Relevant policies<br />National Population Policy (1993)<br /> discourages rural urban migration because excessive it can create urban slams, violence and exacerbate crimes <br />It is only after the 2005, the GoE seems to understand rural-urban migration is key for development<br />E.g. for the time, Tigray Regional state planned to facilitate rural urban migration<br />Change of mind <br />The most urbanized region in Ethiopia <br />4<br />
  5. 5. Registration process inhibits RU migration<br />You need to stay 6 months before you register as urban dweller<br />This means you can get government support <br />You need to have an address, i.e. a house or be a member of a HH who owns a house <br />An ordinary migrant can not be successful in this <br />Social network is very important <br />5<br />
  6. 6. Migration benefits people<br />Releases resources for hh members <br />Creates additional employment opportunities<br />Additional income available to hh (remittances)<br />Risk coping<br />Investments in human and physical capital <br />6<br />
  7. 7. Research Gaps<br />Very few migration studies on Ethiopia<br />Migration behavior not well understood<br />Data to analyze migration is often incomplete <br />Studies that focus on source hh reports exclude migrant destination information<br />Studies that focus on migrants lose information on comparable non-migrants and household members left behind<br />We have a matched migrant sample which allows us to examine the benefits realized by the migrant and the relatives he leaves behind<br />7<br />
  8. 8. Objectives<br />Migration patterns out of 18 kebeles<br />Matching migrant and hh panel to examine<br />Determinants of migration by type<br />Migration benefits<br />Experienced by migrant<br />Experienced by migrant households<br />8<br />
  9. 9. Matched Sample<br />Ethiopian Rural Household Survey (ERHS) <br />Focus on 2004-5 and 2009 rounds (18 kebeles)<br />Tracking survey follows migrants from 2004-5<br />Older than 10 years<br />Moved for employment, schooling (now work), loss of land, resettlement program, and to follow family<br />Relative of household head<br />9<br />
  10. 10. 10<br />
  11. 11. 11<br />Source: Schmidt and Kedir (2009)<br />
  12. 12. 12<br />
  13. 13. Migration by Destination Type<br />13<br />
  14. 14. Rural-to-rural migration most common<br />Partially explains why urbanization is low<br />Has implications on determinants of migration<br />Migrants will likely move to local places<br />Where they have connections<br />Cost of move is cheaper<br />Opportunity cost of move to household lower if remain close<br />14<br />
  15. 15. 15<br />
  16. 16. Migrant’s Characteristics<br />16<br />
  17. 17. Occupations of Migrants<br />17<br />
  18. 18. Household Head Characteristics by Migration Status<br />18<br />Source: ERHS, 2004-5<br />
  19. 19. Determinants of Migration<br />Wage differential<br />Migrant Networks<br />Capital market imperfections<br />Land scarcity<br />Income risk<br />19<br />
  20. 20. Land Scarcity and Rights<br />20<br />Source: Migrant Tracking Survey, 2009<br />
  21. 21. Risk<br />21<br />Source: Migrant Tracking Survey, 2009; ERHS, 2009<br />
  22. 22. Household Shock Exposure by Migration Status<br />22<br />Source: ERHS, 2009<br />
  23. 23. Empirical Model<br />23<br />X: female headship, age, occupation, literacy, ethnicity, support network outside of village, livestock, land, male and female labor endowment<br />Shock: self-reported drought 2000, death or illness in last five years<br />
  24. 24. Migration Probability Results<br />24<br />RR: rural-rural RU: rural-urban<br />1: Defines urban as woreda with >50,000 people<br />2: Defines urban according to 20% agglomeration index<br />
  25. 25. Welfare Implications of Migration<br />Channels of welfare benefits<br />Auxiliary income through remittances<br />Additional resources from migrant’s absence <br />Consumption changes<br />Source households<br />Individual Migrants<br />Changes in subjective well-being<br />Heads of source households<br />25<br />
  26. 26. Remittances<br />Generally remittance rate of internal migrants is lower than rate of international migrants<br />Africa tends to have lowest rates<br />China (2000): 66.4 percent<br />El Salvador (2008): 70.8 percent<br />South Africa (1993): 29.7 percent<br />Ethiopia (2009): 33 percent<br />Conditional on sending remittances, average sent to hh in 2009 was 716 Birr (6.7 % per capita GDP)<br />26<br />
  27. 27. 27<br />Household Food Scarcity by Migration Status over Time (ERHS)<br />
  28. 28. Comparing Consumption of Migrants versus Source Households (2009)<br />28<br />
  29. 29. Comparing Consumption Changes of Migrants<br />29<br />
  30. 30. Changes in Subjective Well-being<br />30<br />
  31. 31. Discussion<br />Migration low and predominantly rural-rural<br />agglomeration economies and future growth?<br />provision and expansion of public services to many Ethiopians will be cost-prohibitive<br />Migration is insurance related<br />Little land and shocks increase migration<br />Suggestive evidence that migrants may benefit from moving<br />Policies to reduce barriers of migration<br />Lack of remittances and lack of changes in source households welfare suggest members are ejected from household to relax constraints<br />31<br />

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