The role of migration on poverty reduction in Indonesia: A quest on the migrants’ welfare before and after migration

It is theoretically argued that there is a strong linkage between migration and poverty. Migration can be treated as an alternative to improve individuals’ welfare and to minimize the risk of being prone to poverty. Many studies have found that migrants on the average better than non-migrants. However little is known to what extent that migration process can improve migrants’ welfare and to avoided poverty. This study wants to shed lights on that issue.

The empirical findings reveal the amount of wage received after migration is higher compared to prior to migration. Health and educational attainment plays a crucial role in determining the amount of wage received. In addition, as it is expected, formal sector offer higher increase in wage than informal sector. In contrast, the effect of gender disparity on wage is gradually decreasing over the years. The greater wage received by migrants’ worker after migration taken place has improved their welfare and put them far from poverty. The higher wage received by migrants’ worker could be translating into the benefit from migration could be utilized to improved their human capital investment. In addition, the wage surplus potentially can be used to assist new migrants.