The Effects of International Migration on Migrant-Source Households: Evidence from Ethiopian Diversity-Visa Lottery Migrants

About a million people have migrated to the US via the Diversity Visa (“DV”) lottery. The DV was instituted by an Act of the United States Congress to diversify the U.S. population through a lottery made available to people from countries with historically low rates of immigration to the country. In any given year, the probability of winning the lottery is less than 1%, with millions of people from around the world competing for a maximum of 55,000 immigrant visas that can be obtained through this migration channel. Using Ethiopian DV participants, which have consistently made up between 6% and 8% of all DV immigrants, I study the causal effects of emigration on the well-being of the migrant sending families. I infer that migration contributes positively to the welfare of the source families. Overall, migration increases consumer expenditure, but has no effect on savings and business ownership of the senders. The positive treatment effects do not diminish with duration of emigration. Migrant men contribute more to the increase in their families' standard of living than their female counterparts do: while expenditure on food and energy are invariant to the migrants' gender, the gains in terms of durable ownership, access to clean water, and sanitation facilities occur almost entirely in families where the emigrants are men. I find that DV participants are favorably selected relative to the overall population.