Return Migration: Theory and Empirical Evidence from the UK

TLDR

The article examines non‑permanent migration, focusing on temporary returns decided by immigrants, and develops a model explaining why migrants return despite higher wages abroad, including heterogeneity and selective migration implications. The authors construct a simple model with three return motives—price differentials, consumption‑location complementarities, and foreign human‑capital accumulation—and extend it to account for immigrant heterogeneity. Return migrations are frequent, with empirical evidence from the UK supporting this pattern.

Abstract

Abstract In this article, we discuss forms of migration that are non‐permanent. We focus on temporary migrations where the decision to return is taken by the immigrant. These migrations are likely to be frequent, and we provide some evidence for the UK. We then develop a simple model that rationalizes the decision of a migrant to return to his/her home country, despite a persistently higher wage in the host country. We consider three motives for a temporary migration: (i) differences in relative prices between host and home country, (ii) complementarities between consumption and the location where consumption takes place, and (iii) the possibility of accumulating human capital abroad, which enhances the immigrant's earnings potential back home. For the last return motive, we discuss extensions that allow for immigrant heterogeneity, and develop implications for selective in‐ and out‐migration.