Migration and labor supply in Georgia: an empirical study

This paper explores the impacts of migration on the labor supply decisions of left-behinds. Based on the data from the Georgian Household Survey and employing the instrumental variable Probit regression, this study establishes a causal link between migration and labor market outputs in Georgia. Another goal of the study is to ascertain whether or not the impact of migration on the labor market outcomes of left-behinds depends on the migrant's relationship to a household head. The results of the study suggest that international migration is an important predictor of the labor participation choices and the employment status of left-behinds and that these effects are robust to the control of remittances. However, the impact of migration on the labor market participation/inactivity decisions of left-behind family members differs substantially by the household status of the migrant as well as the gender of left-behinds. For left-behind females, the effect of migration on their labor participation decisions is significant and has a negative sign. For males, having a migrant in a household increases the probability of their participation in the labor market only when the migrant is a child from a nuclear family.