lecture 2 - determinants and motives of migration Flashcards
(27 cards)
what are Ernst Ravenstein’s 7 Laws of Migration?
1) most migrants move short distance, usually to large cities
2) migrants from rural areas in cities and therefore migration from more distant areas to the rural
3) out-migration is inversely related to in-migration
4) immigration wave will generate a compensating counter-wave
5) long-distance migrants will move to large cities
6) rural persons are more likely to move than urban persons
7) women are more likel to migrate than men
Equation of the gravity model
Mij= (Pi*Pj)/Dij
Mij= number of migrants in location in from location j
Pi/Pj=population size in location i/j
Dij:distance between the locations i and j
HC model of migration
HC theory by Becker 1962 as the most modern economic migration theory
+ Sjaastad 1962 understanding migration decision as “investment in human ressources”
-> maximize utility by comparing utility across all availabel locations and migrate if highest expected utility in alternative location is higher than moentary and non-monetary costs of migration
Migration as a response to relative deprivation
Inequality is often extremely high in sending countries
Happiness(utility) depends not only on absolute income level, but also income level realtive to peers at current location
not relative to host country
why is the migration often temporary?
mostly higher value of consumption at home.
heterogenous preferences: preferences of individuals reagarding their location of consumption differ across the population
what determines the length of migration episodes?
individual preferences to consume at home
->income opportunities and locational preferences
Are the preferences stable?
no, preferences may change over life-cycle
-> individuals adjust preferences bc they become more familiar with host country or hoe-sick
-> changes in economic environment can change preferences
Migration under uncertainty
in HC theory: migration as investment decision with perfect foresight
-> Option value of waiting model by Burda 1995
briefly explain the option value of waiting
If uncertainty increases, the option value of waiting increases as well and, hence, the threshold level for investment(=migration)
threshold=Schwelle
but when we consider uncertainty why (i) is the total migration relatively low and (ii) migration adjust sluggishly to changes in economic conditions?
Many migration decision are undertaken in the family or household
-> Stark considers migration decisions as a portfolio decision with pool risks across household members
Explain micer’s tied mover model 1978
- couple will move if net gains of household are positive
- The partner with the net loss is called tied mover
- mostly female income levels are lower -> this has substantial gender implications
Oded Stark’s portfolio model of family migration decisions
- labor market shocks at different locations are weakly correlated -> migration reduces risk for familiies
- in case of earning shocks remittances of other famil memebers work as insurance
what abt Migration Networks?
empirically proved that migrants tend to move to countries, cities or neighborhoods where other migrants of the same nationality or co-ethnic groups live
- Migration Networks and past migration reduce economic, social and psychological costs
by sharing common language, culture and lower information and search costs
McFadden’s discrete choice model
model where you make rational choice between different locations.
You assume that individual utility depens on deterministic, observable aspects (income levels, geographical distance) + random non-deterministic part, non-observable and subjective
Early theories vs modern theories
early: explain migration simply by wage differences or more complex like gravity equation
modern: understand migration as investment in HC
învestments depend on 1) expectations on income factors affecting utility 2) labor market opportunities 3)imperfect information and uncertainty
why does the RUM model contain deterministic and stochastic components?
RUM=Random Utility Maximization Model
individuals are heterogenous
keep in mind the results of literature
no robus results regarding the role of income differences between destination and sending countries
recent literature considers impact of alternative destinations on bilateral migration as well
what is the trick abt the McFadden 1974 model?
the non-deterministic part is distributed across the population
-> stocks between 2 regions can be explained by bilateral varibales only and the random term has an expected value of zero
what does “stochastic” mean?
stochastic component is a random component that cannot be explained by the observed variables or predicted
how abt alternative destinations?
on which 2 variables are we focussing then?
not convenient for empirical models, so bilateral migration depending on
1) costs of bilateral distance
2) relative attractiveness of dest. and send. country
IIA
what can we say abt IIA
we assume the Irrelevance of Independent Alternatives
(but the assumption is false empirically)
what include the distance variables?
3
geographical distance
linguistic distance and cultural distance
colonial ties
what include the policy variables?
3
immigration restirctions and policies (e.g. free movement of labor)
war and persecution
asylum policies
fixed effects vs pooled estimation
dyadic fixed effects capture all constant variables (all types of distance e.g.)
vs. pooled estimation to cover unobserved bilateral factors which vary over time
