Migration Costs and Networks: household optimal investment in migration

Gentili, Andrea (2013) Migration Costs and Networks: household optimal investment in migration. Bologna: Dipartimento di Scienze economiche DSE, p. 33. DOI 10.6092/unibo/amsacta/3896. In: Quaderni - Working Paper DSE (867). ISSN 2282-6483.
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Abstract

International migration is an expensive form of investment, that only households relatively better off can afford. However poorer households have the higher incentive to migrate. Migration decision is conditional on the entry cost, expected returns and risks of migration. This paper, using data from Mexican rural and urban areas, examines the relation between household and community networks and costs and risks of migration focusing on the optimal investment in migration. To investigate an household optimal number of migrants this paper introduces a Three Step procedure to solve simultaneously for the endogeneity of network size and possible selection of migrants. The analysis confirms the inverted U-shaped relation between wealth and migration, stressing the importance of networks particularly in facilitating the migration of social strata belonging to the left tail of the income distribution. Moreover, in presence of sunk costs and/or high initial investment, household and community networks accomplish different functions.

Abstract
Document type
Monograph (Working Paper)
Creators
CreatorsAffiliationORCID
Gentili, Andrea
Keywords
Migration, Network effect, Costs
Subjects
ISSN
2282-6483
DOI
Deposit date
05 Dec 2013 09:32
Last modified
19 Feb 2014 08:46
URI

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