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RURAL LABOR MIGRATION: Migrant Network, Information, and Hysteresis

  • Zhao, Jinhua

We investigate a rural household's decision to migrate part or all of its labor to urban areas. Labor migrates only when the expected return passes a hurdle rate that is affected by migration networks. We develop a dynamic model of incomplete information, and characterize the unique pure strategy perfect Bayesian equilibrium. Based on the predictions of the equilibrium, we develop a set of econometric models to estimate the migration decisions. Our results show that more current information helps migration, while the expectation of more information in the future may higher migration.

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File URL: http://purl.umn.edu/19990
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Paper provided by American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association) in its series 2004 Annual meeting, August 1-4, Denver, CO with number 19990.

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Date of creation: 2004
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Handle: RePEc:ags:aaea04:19990
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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 for the Study of Labor (IZA).
  2. Epstein, Gil S., 2002. "Informational Cascades and Decision to Migrate," IZA Discussion Papers 445, Institute for the Study of Labor (IZA).
  3. Elie Appelbaum & Aman Ullah, 1997. "Estimation Of Moments And Production Decisions Under Uncertainty," The Review of Economics and Statistics, MIT Press, vol. 79(4), pages 631-637, November.
  4. Zhao, Yaohui, 1999. "Labor Migration and Earnings Differences: The Case of Rural China," Economic Development and Cultural Change, University of Chicago Press, vol. 47(4), pages 767-82, July.
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