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Development, agglomeration, and the organization of work

  • Fafchamps, Marcel

This paper discusses how the mechanisms that allocate workers to tasks vary systematically with isolation from markets and hence with distance from urban centers. This in turn affects social norms, household structure, and the perceived benefits of migration. The relevance of the framework is illustrated with empirical evidence from personal research, much of which is based on a detailed analysis of Nepal in the 1990s. The evidence shows that away from cities, economic activity reverts largely around the family and the household. Agglomeration makes gains from specialization possible. This leads to self-employment in non-farm activities, but not necessarily to wage employment. The evidence also shows that proximity to markets generates not only higher monetary income but also welfare gains that attract migrants and foster urbanization.

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Article provided by Elsevier in its journal Regional Science and Urban Economics.

Volume (Year): 42 (2012)
Issue (Month): 3 ()
Pages: 459-472

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Handle: RePEc:eee:regeco:v:42:y:2012:i:3:p:459-472
Contact details of provider: Web page: http://www.elsevier.com/locate/regec

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  1. Marcel Fafchamps & Forhad Shilpi, 2009. "Isolation and Subjective Welfare: Evidence from South Asia," Economic Development and Cultural Change, University of Chicago Press, vol. 57(4), pages 641-683, 07.
  2. Marcel Fafchamps & Forhad Shilpi, 2005. "Cities and Specialisation: Evidence from South Asia," Economic Journal, Royal Economic Society, vol. 115(503), pages 477-504, 04.
  3. Marcel Fafchamps & Agnes Quisumbing, 2004. "Assets at Marriage in Rural Ethiopia," Development and Comp Systems 0409024, EconWPA.
  4. Marcel Fafchamps & Bereket Kebede & Agnes R. Quisumbing, 2009. "Intrahousehold Welfare in Rural Ethiopia," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 71(4), pages 567-599, 08.
  5. Marcel Fafchamps & Jackline Wahba, 2004. "Child Labor, Urban Proximity, and Household Composition," Economics Series Working Papers 213, University of Oxford, Department of Economics.
  6. Joseph G. Altonji & Fumio Hayashi & Laurence J. Kotlikoff, 1995. "Parental Altruism and Inter Vivos Transfers: Theory and Evidence," Boston University - Institute for Economic Development 65, Boston University, Institute for Economic Development.
  7. McKenzie, David & Gibson, John & Stillman, Steven, 2006. "How important is selection ? Experimental versus non-experimental measures of the income gains from migration," Policy Research Working Paper Series 3906, The World Bank.
  8. Parente, Stephen L & Prescott, Edward C, 1994. "Barriers to Technology Adoption and Development," Journal of Political Economy, University of Chicago Press, vol. 102(2), pages 298-321, April.
  9. Marcel Fafchamps, 2004. "Market Institutions in Sub-Saharan Africa: Theory and Evidence," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262062364, June.
  10. Lundberg, S. & Pollak, R.A., 1991. "Separate Spheres Bargaining and the Marriage Market," Working Papers 91-08, University of Washington, Department of Economics.
  11. Fafchamps, Marcel & Quisumbing, Agnes R., 2008. "Household Formation and Marriage Markets in Rural Areas," Handbook of Development Economics, Elsevier.
  12. Marcel Fafchamps & Klaus Desmet, 2003. "Employment Concentration across US Counties," Economics Series Working Papers 180, University of Oxford, Department of Economics.
  13. Jean-Philippe Platteau, 2000. "Allocating and Enforcing Property Rights in Land: Informal versus Formal Mechanisms in Subsaharan Africa," Nordic Journal of Political Economy, Nordic Journal of Political Economy, vol. 26, pages 55-81.
  14. Marcel Fafchamps & Forhad Shilpi, 2000. "The Spatial Division of Labor in Nepal," Economics Series Working Papers 44, University of Oxford, Department of Economics.
  15. Patrick Legros & Andrew F. Newman, 2007. "Beauty Is a Beast, Frog Is a Prince: Assortative Matching with Nontransferabilities," Econometrica, Econometric Society, vol. 75(4), pages 1073-1102, 07.
  16. Gary S. Becker, 1981. "A Treatise on the Family," NBER Books, National Bureau of Economic Research, Inc, number beck81-1, June.
  17. Marcel Fafchamps & Forhad Shilpi, 2013. "Determinants of the Choice of Migration Destination," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 75(3), pages 388-409, 06.
  18. M. Fafchamps & A. R. Quisumbing, 2002. "Control and Ownership of Assets Within Rural Ethiopian Households," Journal of Development Studies, Taylor & Francis Journals, vol. 38(6), pages 47-82.
  19. Marcel Fafchamps & Bart Minten, 1999. "Property rights in a flea market economy," CSAE Working Paper Series 1999-25, Centre for the Study of African Economies, University of Oxford.
  20. Kingdon, Geeta Gandhi & Knight, John, 2004. "Unemployment in South Africa: The Nature of the Beast," World Development, Elsevier, vol. 32(3), pages 391-408, March.
  21. Bloch, Francis & Genicot, Garance & Ray, Debraj, 2008. "Informal insurance in social networks," Journal of Economic Theory, Elsevier, vol. 143(1), pages 36-58, November.
  22. Fafchamps, Marcel & Shilpi, Forhad, 2006. "Subjective Welfare, Isolation and Relative Consumption," CEPR Discussion Papers 6002, C.E.P.R. Discussion Papers.
  23. McElroy, Marjorie B & Horney, Mary Jean, 1981. "Nash-Bargained Household Decisions: Toward a Generalization of the Theory of Demand," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 22(2), pages 333-49, June.
  24. Marcel Fafchamps & Agnes R. Quisumbing, 2003. "Social roles, human capital, and the intrahousehold division of labor: evidence from Pakistan," Oxford Economic Papers, Oxford University Press, vol. 55(1), pages 36-80, January.
  25. Klaus Desmet & Marcel Fafchamps, 2005. "Changes in the spatial concentration of employment across US counties: a sectoral analysis 1972--2000," Journal of Economic Geography, Oxford University Press, vol. 5(3), pages 261-284, June.
  26. Marcel Fafchamps & Agnes R. Quisumbing, . "Human Capital, Productivity, and Labor Allocation in Rural Pakistan," Working Papers 97019, Stanford University, Department of Economics.
  27. David McKenzie & John Gibson & Steven Stillman, 2006. "How Important is Selection? Experimental vs Non-experimental Measures of Income Gains from Migration," Working Papers in Economics 06/03, University of Waikato, Department of Economics.
  28. Pieter Serneels, 2007. "The Nature of Unemployment among Young Men in Urban Ethiopia," Review of Development Economics, Wiley Blackwell, vol. 11(1), pages 170-186, 02.
  29. David McKenzie & John Gibson & Steven Stillman, 2010. "How Important Is Selection? Experimental vs. Non-Experimental Measures of the Income Gains from Migration," Journal of the European Economic Association, MIT Press, vol. 8(4), pages 913-945, 06.
  30. Fafchamps, Marcel & Quisumbing, Agnes R, 2005. "Marriage, Bequest, and Assortative Matching in Rural Ethiopia," Economic Development and Cultural Change, University of Chicago Press, vol. 53(2), pages 347-80, January.
  31. Coate, Stephen & Ravallion, Martin, 1993. "Reciprocity without commitment : Characterization and performance of informal insurance arrangements," Journal of Development Economics, Elsevier, vol. 40(1), pages 1-24, February.
  32. Shapiro, Carl & Stiglitz, Joseph E, 1984. "Equilibrium Unemployment as a Worker Discipline Device," American Economic Review, American Economic Association, vol. 74(3), pages 433-44, June.
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