Summary 

This paper explores the existing interrelationships between migration and labor market outcomes of left-behind household members in Georgia. Based on the Georgian Household Survey, we tried to answer the questions that remained relatively unexplored in economic literature. First, we employed IV-technique to establish causal link between migration and labor market outputs in Georgia. The study results suggest the international migration is an important predictor of labor participation choices of non-migrants and that the effects of migration on labor market participation/inactivity decisions of left-behind family members differ substantially by gender of left-behinds and settlement type Second, we explored alternative reasons of inactivity among left-behind members in migrant-sending households. Applying multinomial Probit model, we ascertained that disincentive effect of migration on labor participation of left-behind household members, is less likely to occur in Georgia. According to the findings of this study, migration affects inactivity of left-behinds mainly though substitution or education effects. 

Keywords: Migration, Labor Supply, Time Allocation, Georgia