This study examined how skilled and unskilled migration differentially affected formal sector wage structures in Uzbekistan and Kazakhstan from 2019 to 2024. Using difference-in-differences analysis with instrumental variables on region-sector-quarter panel data, the research found skilled migration generated wage premiums 2.2 times larger than unskilled migration effects. Instrumental variable estimates revealed skilled migration increased wages by 38.6% while reducing inequality, compared to 16.4% wage increases from unskilled migration. Capital-intensive sectors showed stronger responses than labor-intensive industries, with Kazakhstan exhibiting larger effects than Uzbekistan. Effects operated through productivity channels, capital accumulation, and positive sorting. These findings inform skill-differentiated migration policies in transitional economies.
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Fontalvo et al. (2025) studied this question.
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