Rural-urban migration and the well-being of the migrant-sending households: An impact evaluation study

Background: Rural-urban migration is largely depicted as a household survival strategy, yet rigorous quantitative studies to uncover its impact on the sending households is rare.Aim: The study aims to assess the causal impacts of rural-urban migration on sending households’ economic and subjective well-being (SWB).Setting: The context of the analysis is South African rural-urban migration using the National Income Dynamics Study panel data.Methods: A range of methods are used to increase the consistency and precision of estimates, namely: Ordinary Least Squares, Fixed Effects, Difference in Differences, Difference in Differences with Propensity Score Matching and Difference in Differences with instrumental variables, controlling for pertinent issues such as fixed effects, self-selection and endogeneity.Results: Our econometric analysis reveals a positive correlation between migration and the SWB of the sending household. This effect can be attributed to a range of factors discussed in the study, one of which is the positive association observed between the migration of a household member and the origin household’s economic well-being. This upswing in economic well-being is captured by increasing the sending household’s monthly income per capita and increased remittance inflows.Conclusion: From our analysis, we can infer that the improvement in economic well-being offsets the psychological effects of separation, thus leading to the enhanced SWB of the migrant-sending households in South Africa.