Abstract
Abstract Bilateral labor agreements (BLAs) are preferred policy models for regulating migration by many governments around the world. The Philippines has been a leader in both agreement conclusion and exporting labor. A recent Congressional evocation is pushing bureaucrats and academics alike to investigate this policy strategy for outcomes and effectiveness. The following analysis answers the question “Do BLAs affect the migration outflows of Overseas Filipino Workers (OFWs)?” using a plausibly exogenous variation to isolate a causal effect. I test for effects of BLAs using two instrumental variables (IVs), such as Bilateral Investment Treaties (BITs) and Formal Alliances, and an original dataset of land-based and sea-based Filipino BLAs and migrant stock in 213 unique areas from 1960 to 2018. I do not find any empirical evidence that these treaties drive migration. However, BLAs have statistically significant effects on gross domestic product (GDP) per capita and exports, suggesting other important channels through which these agreements affect economic outcomes. These null results are critically important for policymakers and diplomats because the resources spent on negotiation are wasted if the primary goal is to increase migration.
Highlights
Migration for securing employment and increasing wages is no longer an obscure personal choice; today it is a global phenomenon
This paper focuses on one form of the accord, bilateral labor agreement (BLA), growing in popularity since the 1940s
The theoretical model is macroeconomic in nature and allows migrant stock of Overseas Filipino Worker (OFW) to be a function of a BLA with a host country, in addition to a set of control variables, yit = β0 + β1BLAit + †2 ′xit + αi + δt + uit (1)
Summary
Migration for securing employment and increasing wages is no longer an obscure personal choice; today it is a global phenomenon. 2% of the global population engages in some form of labor migration, be it temporary or permanent. National policies institutionalize and the United Nations (UN) Sustainable Development Goals (SDGs) further reify this practice rendering it commonplace (United Nations Foundation, n.d.). A recent UN Department of Economic and Social Affairs study finds that 68% of countries identify “meeting labor market demands” as the primary reason for their current immigration policies (United Nations, 2019), indicative of congruence between labor-sending and labor-receiving countries. Despite the mutual response to market needs, sometimes further steps are necessary to bring nations into concordance. This paper focuses on one form of the accord, bilateral labor agreement (BLA), growing in popularity since the 1940s
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