the non-random selection of migrants. The first examines the effect of migration on income in Ghana and finds that migrant households earn more than their non-migrant counterparts. Yet, the analysis is restricted to the Volta Basin and uses income as a welfare metric. The latter, using 1998/99 survey data, concludes that urban migration improved consumption of internal migrants.

Using data from a 2005/06 survey, Ackah and Medvedev (2010) estimate a positive effect of migration on household consumption only if households send migrants to urban areas from where migrants are more likely to send remittances and to do so in larger amounts. They account for the non-random selection of migration, yet the exclusion restriction appears to be flawed by the fact that the migration rate at the district level used is posterior, or at best contemporaneous, to the migration episodes. Adams et al. (2008) use the same data source and find a negative effect of remittances on poverty and a positive impact on inequality. The authors allow for three mutually exclusive states, namely receiving no remittances, receiving remittances from Ghana, and receiving remittances from abroad, thus separating out the effect of international from that of internal remittances. They account for selection by exploiting variations in migration networks among a number of ethno-religious groups and estimate a remarkably larger effect of international remittances. Karamba et al. (2011) study the impact of internal migration on food consumption. They find migration does not affect overall food expenditure per capita and decreases consumption of meat, fish, vegetables, and fruits. They estimate a positive effect of migration on consumption only in regions with significantly higher migration rates. Finally, Adams and Cuecuecha (2013) consider the effect of internal and international remittances on investment and poverty. They show that households receiving remittances spend marginally less on food and marginally more on investment goods, namely education, housing, and health. They also estimate a negative effect on the likelihood of being poor among households receiving remittances.

This paper brings new evidence on the link between internal migration and household welfare using the most recent nationally representative household survey in Ghana conducted between 2012 and 2013. Controlling for region of origin and adopting an inter-regional definition of migration, we identify the impact of migration on the consumption level of households that migrated relative to households that stayed behind in the same region of origin. As is well known in the literature on migration, migrants are typically not a random sample of the population. They might self-select themselves into migration according to their educational and skill level, age, propensity to risk, entrepreneurship, etc. These characteristics affect the future discounted income differential between migrating and staying behind, and as such they increase the propensity to change location. In order to address the selection bias, we estimate a selection-corrected equation, namely an equation for the probability of migrating together with the consumption equation of interest. The idea exploits a simple fact: migrants tend to settle where other migrants from the same village (or town) of origin reside. In a multiethnic country like Ghana, where there are several overlaps between administrative regions and ethnicities, this mechanism is likely to be at work. We make a step forward relative to the existing studies on Ghana by making use of historical migration networks at destination as an exclusion restriction. Specifically, we use district-level information from the 1984 Census to construct the network, measured by the historical internal immigration rate at destination.

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