Wealth Heterogeneity and the Income Elasticity of Migration
American Economic Journal: Applied Economics
vol. 9,
no. 2, April 2017
(pp. 219-55)
Abstract
How do income shocks affect international migration flows from poor countries? Income growth not only increases the opportunity cost of migration but also eases liquidity constraints. I develop a method to separate these countervailing individual effects and identify the overall income elasticity of migration. Using new administrative and census data from Indonesia, I find that positive agricultural income shocks increase labor emigration flows, particularly in villages with relatively more small landholders. However, in the most developed rural areas, persistent income shocks reduce emigration. Overall, the findings highlight the important role of wealth heterogeneity in shaping migration flows as incomes rise.Citation
Bazzi, Samuel. 2017. "Wealth Heterogeneity and the Income Elasticity of Migration." American Economic Journal: Applied Economics, 9 (2): 219-55. DOI: 10.1257/app.20150548Additional Materials
JEL Classification
- F22 International Migration
- J43 Agricultural Labor Markets
- O13 Economic Development: Agriculture; Natural Resources; Energy; Environment; Other Primary Products
- O15 Economic Development: Human Resources; Human Development; Income Distribution; Migration
- Q11 Agriculture: Aggregate Supply and Demand Analysis; Prices
- Q12 Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
- R23 Urban, Rural, Regional, Real Estate, and Transportation Economics: Regional Migration; Regional Labor Markets; Population; Neighborhood Characteristics
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