Determinants of Intra-ASEAN Migration

Abstract

International labor mobility in Southeast Asia has risen drastically in recent decades and is expected to continue increasing with the establishment of the Association of Southeast Asian Nations (ASEAN) Economic Community in 2015. This paper looks at the determinants of the movement of workers and finds three structural factors that will likely drive further intra-ASEAN migration in the coming years: (i) demographic transition, (ii) large income differentials between economies, and (iii) the porosity of borders. A microfounded gravity model is estimated in order to empirically analyze the main determinants of intra-ASEAN migration in the period 1960–2000. Results suggest that the movement of migrants between Southeast Asian economies has mostly been driven by higher wages and migrant social networks in destination economies, as well as natural disasters in origin economies.