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Regional Migration, Insurance and Economic Shocks: Evidence from Nicaragua

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  • Molina Millán, Teresa

    (Universidad de Alicante)

Abstract

To test whether transfers sent and received by regional migrants serve an insurance role, this paper estimates the causal impact of income shocks at a migrant's origin and destination location on the bilateral transfer of funds. Using rainfall shocks in rural Nicaragua, I find that migrants aged 15-21 years provide unilateral insurance to their origin household. Distinguishing by destination and economic activity I show that the level of insurance increases when migrants and households are exposed to less correlated shocks. In addition, I find evidence of bilateral insurance among rural migrants exposed to rainfall shocks with low levels of correlation with respect to shocks occurring at origin.

Suggested Citation

  • Molina Millán, Teresa, 2015. "Regional Migration, Insurance and Economic Shocks: Evidence from Nicaragua," IZA Discussion Papers 9494, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp9494
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    More about this item

    Keywords

    insurance; risk; remittances; internal migration; inter-households transfers; weather shocks;
    All these keywords.

    JEL classification:

    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • F24 - International Economics - - International Factor Movements and International Business - - - Remittances
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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