Are Internal Migrants in Albania Leaving for the Better?

Abstract

While Albania is more known for its massive international migration flows, internal migration is also noteworthy and, more important, understudied. This paper tries to fill a gap in the migration literature by assessing the impact of internal migration on household wellbeing. Albania is an ideal case to study the phenomenon, since no migration, whether internal or international, was allowed before 1990 and, therefore, it constitutes a quasiexperimental setting. The study relies on a unique dataset, the 2005 Albania Living standards Measurement Study (ALSMS) with a focus on the migrant households oversampled in periurban Tirana, which will be compared to rural households not migrated internally. We take advantage of detailed information on the residence duration of internal migrants, housing and wealth variables for 1990, as well as the current local economic and social conditions they are exposed to. The aim is to assess whether wellbeing in terms of income, consumption, health, education, and housing has changed owing to internal migration. Descriptive statistics confirm earlier studies on migrants in peri-urban Tirana and show that migrant households live in poor dwelling conditions, are employed in irregular and unstable jobs and experience low levels of health and schooling. However, their total per-capita income is significantly higher than for rural households, while differences in terms of consumption are unclear. Further analysis on the impact of internal migration is based on two econometric techniques. The propensity-score-matching (PSM) approach and a two-step instrumental variable (IV) procedure - through a zero inflated count model at the first stage, an innovative element in the migration literature - are used to gauge a systematic difference between rural migrant households in the destination communities with similar counterparts in rural Albania who did not move, taking their pre-migration wealth and living conditions into account. Empirical results confirm that households which moved to peri-urban Tirana experienced an income gain, while the differences in terms of consumption are lower, overall. The revenue increase is mostly due to higher but irregular wages which do not seem to completely offset rising living expenses (e.g. food, water, housing), as well as costs not occurring in rural areas.

Keywords: internal migration, Albania, impact analysis, urbanisation, poverty

JEL Classification: I32, O15, P36, R23