Financial Constraints, Endogenous Educational Choices and Self-Selection of Migrants
AbstractThe Roy model predicts that migrants will be disproportionately drawn from the lower half of the educational distribution of the sending country if the sending country has a higher return to schooling. However, Mexican immigrants in the U.S. tend to be disproportionately drawn from the middle of the distribution. This paper argues that financial constraints may explain why. It studies migrants' selectivity when agents that face credit constraints make joint decisions about how much to invest in education and whether to migrate. The results show that financial constraints can explain the intermediate selection of migrants observed in the data.
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Bibliographic InfoPaper provided by RAND Corporation Publications Department in its series Working Papers with number 758.
Length: 28 pages
Date of creation: May 2010
Date of revision:
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More information through EDIRC
migration; financial constraints; self-selection; human capital;
Find related papers by JEL classification:
- O15 - Economic Development, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
- O16 - Economic Development, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
- R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-07-03 (All new papers)
- NEP-DEV-2010-07-03 (Development)
- NEP-EDU-2010-07-03 (Education)
- NEP-HRM-2010-07-03 (Human Capital & Human Resource Management)
- NEP-MIG-2010-07-03 (Economics of Human Migration)
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