Tim Halliday, University of Hawaii at Manoa

Abstract

This paper utilizes panel data from El Salvador to investigate the use of trans-national migration as an ex post risk management strategy. Our results indicate that adverse agricultural conditions pushed household members to the US. In contrast, we show that households responded to the 2001 earthquakes by retaining household members in El Salvador. While we find that liquidity constraints are an important determinant of households' migration decisions, we find that the effects of the earthquakes were independent of household wealth suggesting that the earthquakes affected migration through a channel other than liquidity constraints.