Estimation of Labor Migration Impact on the Economy of Sending Country

Lviv Politechnic National University
Academy of Public Administration under the President of the Republic of Kazakhstan
Lviv Polytechnic National University

This paper provides a theoretical framework for estimating the labor migration impact on the economy of sending country. The overall emigration impact includes two effects, which can be calculated separately, i.e., a departure effect and a remittances effect. The departure effect causes a negative impact on the economy by decreasing autonomous consumption. The remittances effect causes a positive impact by increasing disposable income and thus internal consumption and savings and imports. Calculations include the multiplier effect. The labor emigration impact on GDP is calculated as a difference between a positive remittances effect and a negative departure effect. The analysis is conducted for countries that are not at full employment.

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