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Relative Deprivation, Wage Differentials and Mexican Migration

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  • Michael A. Quinn

Abstract

This paper constructs and tests a model that incorporates relative deprivation into the migration decision. Relatively deprived individuals view their situations as less than a community standard. Another innovation of this paper is the utilization of a cluster approach to wage differentials. This cluster method takes account of individual characteristics while avoiding the severe multicollinearity problems inherent in the standard wage equation approach. Using data from the Mexican Migration Project, relative deprivation is found to be a significant motivating factor in domestic migration decisions. The results also suggest that Mexico‐US migration may be increasing relative deprivation in Mexican communities. For policymakers, the results indicate that policies attempting to slow domestic rural‐to‐urban migration must address both relative and absolute outcomes in communities. Investments in communities that raise aggregate incomes, but increase relative deprivation, could result in an increase in migration out of the community, not in a decrease as intended.

Suggested Citation

  • Michael A. Quinn, 2006. "Relative Deprivation, Wage Differentials and Mexican Migration," Review of Development Economics, Wiley Blackwell, vol. 10(1), pages 135-153, February.
    • Handle: RePEc:bla:rdevec:v:10:y:2006:i:1:p:135-153
    DOI: 10.1111/j.1467-9361.2005.00306.x
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    References listed on IDEAS

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    1. Bauer, Thomas K. & Epstein, Gil S. & Gang, Ira N., 2002. "Herd Effects or Migration Networks? The Location Choice of Mexican Immigrants in the U.S," IZA Discussion Papers 551, Institute of Labor Economics (IZA).
    2. Yashiv, Eran, 2003. "Self-Selection of Migrant Workers: Migration Premium and (no) Returns to Skills," CEPR Discussion Papers 4156, C.E.P.R. Discussion Papers.
    3. Pia M. Orrenius, 1999. "The role of family networks, coyote prices and the rural economy in migration from Western Mexico: 1965-1994," Working Papers 9910, Federal Reserve Bank of Dallas.
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