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Informational Cascades and Decision to Migrate

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Author Info
Epstein, Gil S. () (Bar-Ilan University, Israel, CEPR, London and IZA, Bonn)

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Abstract

We introduce the idea that informational cascades can explain the observed regularity that emigrants from the same locations also tend to choose the same foreign locations. Thus informational cascades generate herd behavior. Herd behavior is compared with the network externalities explanation of the same phenomenon. The relation between social tensions and herd behavior is observed when local populations are xenophobic.

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Publisher Info
Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 445.

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Length: 24 pages
Date of creation: Mar 2002
Date of revision:
Handle: RePEc:iza:izadps:dp445

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Related research
Keywords: Migration informational cascades herd behavior xenophobia network externalities

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Find related papers by JEL classification:
F22 - International Economics - - International Factor Movements and International Business - - - International Migration
J61 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Geographic Labor Mobility; Immigrant Workers

This paper has been announced in the following NEP Reports:

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Chiswick, Barry R & Miller, Paul M, 1996. "Ethnic Networks and Language Proficiency among Immigrants," Journal of Population Economics, Springer, vol. 9(1), pages 19-35, February.
  2. Jeffrey Church & Ian King, 1993. "Bilingualism and Network Externalities," Canadian Journal of Economics, Canadian Economics Association, vol. 26(2), pages 337-45, May. [Downloadable!] (restricted)
  3. Fertig, Michael & Schmidt, Christoph M., 2002. "The Perception of Foreigners and Jews in Germany - A Structural Analysis of a Large Opinion Survey," IZA Discussion Papers 431, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  4. Bikhchandani, Sushil & Hirshleifer, David & Welch, Ivo, 1992. "A Theory of Fads, Fashion, Custom, and Cultural Change in Informational Cascades," Journal of Political Economy, University of Chicago Press, vol. 100(5), pages 992-1026, October. [Downloadable!] (restricted)
  5. Joshua D. Angrist & Adriana D. Kugler, 2001. "Protective or Counter-Productive? Labor Market Institutions and the Effect of Immigration on EU Natives," Economics Working Papers 587, Department of Economics and Business, Universitat Pompeu Fabra. [Downloadable!]
    Other versions:
  6. Sibley, Christopher W. & Walsh, Patrick Paul, 2002. "Earnings Inequality and Transition: A Regional Analysis of Poland," IZA Discussion Papers 441, Institute for the Study of Labor (IZA). [Downloadable!]
  7. King, Stephen P., 1995. "Search with free-riders," Journal of Economic Behavior & Organization, Elsevier, vol. 26(2), pages 253-271, March. [Downloadable!] (restricted)
  8. Epstein, Gil S. & Ward, Melanie E., 2002. "Perceived Income, Promotion and Incentive Effects," IZA Discussion Papers 435, Institute for the Study of Labor (IZA). [Downloadable!]
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  9. Banerjee, Abhijit V, 1992. "A Simple Model of Herd Behavior," The Quarterly Journal of Economics, MIT Press, vol. 107(3), pages 797-817, August. [Downloadable!] (restricted)
  10. Paul R. Krugman & Elise S. Brezis, 1996. "Immigration, investment, and real wages," Journal of Population Economics, Springer, vol. 9(1), pages 83-93.
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  11. Bertola, Giuseppe & Hochguertel, Stefan & Koeniger, Winfried, 2002. "Dealer Pricing of Consumer Credit," IZA Discussion Papers 440, Institute for the Study of Labor (IZA). [Downloadable!]
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  12. Scharfstein, David S & Stein, Jeremy C, 1990. "Herd Behavior and Investment," American Economic Review, American Economic Association, vol. 80(3), pages 465-79, June.
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  13. Carrington, William J & Detragiache, Enrica & Vishwanath, Tara, 1996. "Migration with Endogenous Moving Costs," American Economic Review, American Economic Association, vol. 86(4), pages 909-30, September. [Downloadable!] (restricted)
  14. Giulio Fella & Paola Manzini & Marco Mariotti, 2004. "Does Divorce Law Matter?," Journal of the European Economic Association, MIT Press, vol. 2(4), pages 607-633, 06. [Downloadable!] (restricted)
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Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Epstein, Gil S. & Gang, Ira N., 2004. "The Influence of Others on Migration Plans," IZA Discussion Papers 1244, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  2. Piil Damm, Anna, 2005. "Immigrants’ Location Preferences: Exploiting a Natural Experiment," Working Papers 05-2, University of Aarhus, Aarhus School of Business, Department of Economics. [Downloadable!]
  3. Bauer, Thomas & Epstein, Gil & Gang, Ira N., 2002. "Herd Effects or Migration Networks? The Location Choice of Mexican Immigrants in the U.S," IZA Discussion Papers 551, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  4. Blázquez Cuesta, Maite & Llano, Carlos & Moral Carcedo, Julian, 2008. "Commuting times: Is there any penalty for immigrants?," Working Papers in Economic Theory 2008/05, Universidad Autónoma de Madrid (Spain), Department of Economic Analysis (Economic Theory and Economic History). [Downloadable!]
  5. Pedersen, Peder J. & Pytlikova, Mariola & Smith, Nina, 2004. "Selection or Network Effects? Migration Flows into 27 OECD Countries, 1990-2000," IZA Discussion Papers 1104, Institute for the Study of Labor (IZA). [Downloadable!]
  6. Anna Piil Damm, 2005. "Determinants of Recent Immigrants’ Location Choices: Quasi-Experimental Evidence," CAM Working Papers 2005-17, University of Copenhagen. Department of Economics. Centre for Applied Microeconometrics. [Downloadable!]
  7. Thomas Bauer & Gil Epstein & Ira Gang, 2005. "Enclaves, language, and the location choice of migrants," Journal of Population Economics, Springer, vol. 18(4), pages 649-662, November. [Downloadable!] (restricted)
    Other versions:
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