Information, Intermediaries, and International Migration

Authors

Samuel Bazzi, University of California San Diego, National Bureau of Economic Research, and Centre for Economic Policy ResearchFollow
Lisa Cameron, University of MelbourneFollow
Simone Schaner, University of Southern California and National Bureau of Economic ResearchFollow
Firman Witoelar, Australian National UniversityFollow

Series

Upjohn Institute working paper ; 22-372

DOI

10.17848/wp22-372

Issue Date

August 2022

Abstract

Job seekers face substantial information frictions, especially in international labor markets where intermediaries match prospective migrants with overseas employers. We conducted a randomized trial in Indonesia to explore how information about intermediary quality shapes migration outcomes. Holding access to information about the return to choosing a high-quality intermediary constant, intermediary-specific quality disclosure reduces the migration rate, cutting use of low-quality providers. Workers who do migrate receive better pre-departure preparation and have improved experiences abroad, despite no change in occupation or destination. These results are not driven by changes in beliefs about average provider quality or the return to migration. Nor does selection explain improved outcomes for those who migrate with quality disclosure. Together, our findings are consistent with an increase in the option value of search: with better ability to differentiate offer quality, workers search longer, select higher-quality intermediaries, and ultimately have better migration experiences.

Sponsorship

W.E. Upjohn Institute for Employment Research Early Career Research Award 15-150-02 , Abdul Latif Jameel Poverty Action Lab (J-PAL) Southeast Asia, Australian Dept. of Foreign Affairs and Trade, and National Science Foundation (SES-1942375)

Subject Areas

LABOR MARKET ISSUES; Temporary employment; Job search; INTERNATIONAL ISSUES