The effect of creating a single EAEU labor market on the level of financial well-being of migrant households (exemplified by the Republic of Armenia)

Abstract

The article analyzes the effect of creating a single EAEU labor market on the financial well-being of households in countries that mainly send migrants, exemplified by the Republic of Armenia. Based on data of the Integrated Living Conditions Survey (ILCS) 2012-2017 and using the difference-in-differences method, the study has identified a significant causal relationship between the country’s accession to the EAEU and reduced income gap between households with migrants in Russia and households with migrants in other countries and regions or without migrants at all. Thus, after Armenia’s accession to the EAEU, income of the households sending migrants to Russia became 6-11% higher than the one of the households sending migrants to other countries, despite the fact that until 2015 there was hardly any difference in income; the income gap with the households without migrants decreased from 6% in 2012-2014 to 2% in 2015-2016. The confirmed positive impact of Armenia’s accession to the EAEU makes it possible to consider it a tool for reducing poverty in the Republic of Armenia as well as recommend to continue development and harmonization of the labor migration policy of the EAUE member states.