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Where to create jobs to reduce poverty: cities or towns?

Author

Listed:
  • Ravi Kanbur

    (Cornell University)

  • Luc Christiaensen

    (The World Bank)

  • Joachim De Weerdt

    (University of Antwerp
    KU Leuven)

Abstract

Should job creation be targeted to big cities or to small towns, if the objective is to minimize national poverty? To answer this question, we develop an equilibrium model of migration from rural areas to two potential destinations, small town and big city. We develop sufficient statistics for policy decisions based on the parameters of the model. The empirical remit of the theoretical model is illustrated with long running panel data from Kagera, Tanzania. Further, we show that the structure of the sufficient statistics is maintained in the case where the model is generalized to introduce heterogeneous workers and jobs.

Suggested Citation

  • Ravi Kanbur & Luc Christiaensen & Joachim De Weerdt, 2019. "Where to create jobs to reduce poverty: cities or towns?," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 17(4), pages 543-564, December.
    • Handle: RePEc:spr:joecin:v:17:y:2019:i:4:d:10.1007_s10888-019-09419-5
    DOI: 10.1007/s10888-019-09419-5
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    Cited by:

    1. Joachim De Weerdt & Luc Christiaensen & Ravi Kanbur, 2021. "When distance drives destination, towns can stimulate development," Working Papers of LICOS - Centre for Institutions and Economic Performance 671347, KU Leuven, Faculty of Economics and Business (FEB), LICOS - Centre for Institutions and Economic Performance.
    2. Luc Christiaensen & Joachim De Weerdt & Ravi Kanbur, 2019. "Decomposing the contribution of migration to poverty reduction: methodology and application to Tanzania," Applied Economics Letters, Taylor & Francis Journals, vol. 26(12), pages 978-982, July.
    3. Gibson, John & Jiang, Yi & Susantono, Bambang, 2023. "Revisiting the role of secondary towns: How different types of urban growth relate to poverty in Indonesia," World Development, Elsevier, vol. 169(C).
    4. John Gibson & Yi Jiang & Bambang Susantono, 2022. "Revisiting the role of secondary towns: Effects of different types of urban growth on poverty in Indonesia," Working Papers in Economics 22/05, University of Waikato.
    5. Min Wang & Shuqi Yang & Huajie Gao & Kahaer Abudu, 2021. "The Characteristics, Influencing Factors, and Push-Pull Mechanism of Shrinking Counties: A Case Study of Shandong Province, China," Sustainability, MDPI, vol. 13(4), pages 1-22, February.
    6. Ameye, Hannah & De Weerdt, Joachim, 2020. "Child health across the rural–urban spectrum," World Development, Elsevier, vol. 130(C).
    7. Mulubrhan Amare & Kibrom A. Abay & Channing Arndt & Bekele Shiferaw, 2021. "Youth Migration Decisions in Sub‐Saharan Africa: Satellite‐Based Empirical Evidence from Nigeria," Population and Development Review, The Population Council, Inc., vol. 47(1), pages 151-179, March.

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    More about this item

    Keywords

    Secondary Towns versus big cities; Poverty reduction; Poverty gradient; Todaro model; Migration equilibrium; Equilibrium income distribution;
    All these keywords.

    JEL classification:

    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
    • I3 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

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