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Where do Migrants Go? Risk-Aversion, Mobility Costs and the Locational Choice of Migrants

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  • Daveri, Francesco
  • Faini, Riccardo

Abstract

As part of their effort to pool individual risk, households consider spreading their members over a plurality of locations, both inside and outside their country of origin. At the same time, the world is ridden with ‘Chinatowns’ and ‘Little Italies’: people, whenever they move, tend to bunch in the same location. Bunching would appear fundamentally at odds with the desire to diversify risk. In this paper we provide a framework to reconcile both spatial bunching and the spread of migrants, combining risk-aversion and concavity of mobility costs at the household level. Evidence from Southern Italy is consistent with the main predictions from our model.

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Bibliographic Info

Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 1540.

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Date of creation: Dec 1996
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Handle: RePEc:cpr:ceprdp:1540

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Keywords: bunching; Migration; risk diversification;

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Cited by:
  1. Jennifer Hunt, 2000. "Why Do People Still Live in East Germany?," Discussion Papers of DIW Berlin 201, DIW Berlin, German Institute for Economic Research.
  2. A. Daniela Cristina, 2008. "What Sways the Decision to Migrate? An Empirical Analysis of the Argentinean Case," Revista de Economía y Estadística, Universidad Nacional de Córdoba, Facultad de Ciencias Económicas, Instituto de Economía y Finanzas, vol. 0(1), pages 7-30, January.

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