Does publicly provided health care affect migration? Evidence from Mexico

Clotilde Mahé

#2017-049

Do social policies affect migration? To answer this question, I exploit the random expansion of a publicly provided health care programme in Mexico, as well as the panel dimension and the timing of the Mexican Family Life Survey. Non-contributory health care is found to increase internal migration by freeing up care (time) constraints and strengthening household economic resilience in the face of health- related shocks. However, the alleviation of financial and time constraints is not significant enough to alter international migration, more costly by nature. Results point to the relevance of including both resident and non-resident household members in assessing the effects of social policies on labour market behaviours. They suggest that publicly provided health care complements, rather than substitutes, informal livelihood strategies in that relaxing binding financial and time constraints enables labour force detachment of working-age members in afiliated households.

JEL Classification: I13, I15, I18, I38, J21, O15

Keywords: Health insurance, migration, Mexico, occupational choice