The pro-export effect of subnational migration networks: new evidence from Spanish provinces

Abstract

The paper investigates the effect that subnational networks of immigrants and emigrants had on exports from Spanish provinces (NUTS3) over the period of 2007–2016 by integrating state-of-the-art advances in the gravity model literature. In particular, it allows for heterogeneity in provincial export capacity, which significantly reduces pro-export effects, and select the Poisson Pseudo-Maximum Likelihood as the most suitable estimator according to diagnostic tests. When both immigration and emigration are instrumented, the pro-export effect of immigrants found by previous studies vanishes and that of emigrants, instead, appears appreciable. The results obtained suggest that over the period that encompasses the double-deep crisis, immigrants did not show significant information and enforcement effects in the considered context, while the effects of emigrant demand for home-country goods may have been important. The prevalence of emigrant over immigrant effects appears attributable to a change in the composition of the migration stocks over the considered period of crisis.