Bodvarsson Chapter 2_4 Flashcards
(12 cards)
name 6 theories of why people migrate
1) HC Investment Model
2) Compution/Equilibrium Model
3) Expected Income Hypothesis
4) Relative Deprivation Hypothesis
5) MIgration as Sequential Search and Option Value of Waiting
6) Family or Houseold as the Decision Making Unit
Explain the HC Investment model
migration as an investmnent decision where the prospectivem migrant calculates the present vlaue of lifetime earnings at alternative destination compared to origin, subtrating moving costs
explain the consumption/ equilibrium model
this perspective considers migrants as consumer of amenities and public goods that differ across locations
amenities: pleasant climate
public goods: quality of health care, educational system
more applied to internal migration
the idea: people vote with their feet
Explain expected income hypothesis
individuals migrante as long as the expected wage at destination (considering the probability of employment!), net of costs, equals or exceeds the origin wage
Explain the Relative Deprivation Hypothesis
migration might be be attrictive even if the absolute income is not significantly higher at the destination, provided there is a chanve to achieve a very high income relative to one’s refernce group back home.
relative status can influence happiness more tan absolute income
Explain Migration as Sequential Search and Option Value of Waiting
migration as sequential process where migrants wait for a wage offer that exceeds their reservation wage plus migration costs
Uncertainty can justify delaying the migration decision to obtain more information
Explain Family or Household as the DEcision-Making Unit
migration as a family decision causing conflicting interests (one spouse gains financially while another loses)
2 Theories of Who Migrates - what does Chiswick say, how is Borjas’ model contructed?
Chiswick (1999): immigrants are positive selected due to different migration costs
Borjas (1987): differnces in earnings dispersion (income inequality) as key determinant of who migrates -> if destination country’s wage profie is steeper the ones with higher skill levels migrate & if source country’s wage profile is steeper the relatively less-skilled workers migrate
The Borjas’ model distinguish between..
…composition effects (change in the skill mix of migrants) and scale effects (change in the size of migration flow)
4 extensions and other factors affecting selectivity
1) migration costs: if costs are inversely related to schooling it can favor skilled-migration
2) credit constraint: the poorest cannot afford to migrate and the highest earners have high OC leaing to intermediate selection
3) Family Migration: tied movers can dilute the degree of skill selection bias
4) Asymmetric Inforation, e.g. negative selection in return migration bc it’s not possible to distinguish between high and low-productivit workers returning from abroad so they might offer a wage based on average productivity
Immigrant Assimilation. What does it mean ?
Evidence by Chiswick, Critique by Borjas?
how immigrants integrate nito the destination society focused on how their income catch zp to the native ones
Chiswick:Evidence that immigrant earnings start below natives but converge and eventually surpass
Borjas critiques that cross-sectional data leads to statistic illusion, confusing cohort effects with actual assimilation
What are the issues of Empirical Evidence?
- difficult to obtain accurate and detailed data
- lack of consistency
- -> Empirical results are often tentative and may suffer from measurement erros or mitted variables
