Short-term Migration and Consumption Expenditure of Households in Rural India

Abstract

In 2007–2008, short-term migrants (STMs) constituted 4.35% of the rural workforce in India and a total of 9.25 million rural households included STMs. Using nationally representative data for rural India, this paper examines differences in consumption expenditure across households with and without a household member who is a STM. We use an instrumental variable approach to control for the presence of a STM in a household. We find that households with a STM have lower monthly per capita consumption expenditure and monthly per capita food expenditure compared to households without a STM. STMs are not unionised, they work in the unorganised sector, they do not have written job contracts, and state governments are yet to ensure that the legislation protecting them is properly enforced. This could be one of the reasons why we do not observe higher levels of expenditure in households with such migrants.