IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper or follow this series

What Draws People to Urban Growth Centers: Jobs vs. Pay?

  • Sari Pekkala

The present study analyses migration patterns in Finland to test if microeconomic evidence for the Harris-Todaro model can be found. The Harris-Todaro hypothesis states that rural-urban migration stems from regional differences in the wage level and the chances of finding work. To test the hypothesis one needs to predict urban and rural wage and employment probability for each individual. This method is applied to a study of the recent migratory trend in Finland in which most migrants are heading towards a few urban growth centers while the rest of Finland is losing its population. The present study finds evidence for the Harris-Todaro model and concludes that rural urban migration is a result of higher wages and, even more so, better employment prospects in urban areas. Demographic factors may serve to reduce the migration flows in future, but this reduction is likely to remain modest. The results suggest that the best way to prevent excessive rural population loss is to pay attention to job-creation schemes, concentrating especially on workers with secondary and tertiary education.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.vatt.fi/file/vatt_publication_pdf/k310.pdf
Download Restriction: no

File URL: http://www.vatt.fi/publications/latestPublications/publication/Publication_1345_id/512
Download Restriction: no

Paper provided by Government Institute for Economic Research Finland (VATT) in its series Discussion Papers with number 310.

as
in new window

Length:
Date of creation: 25 Jun 2003
Date of revision:
Handle: RePEc:fer:dpaper:310
Contact details of provider: Postal: Arkadiankatu 7, P.O. Box 1279, FI-00101 Helsinki
Phone: +358 295 519 400
Fax: +358 295 519 599
Web page: http://www.vatt.fi/
Email:


More information through EDIRC

Order Information: Email:


References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Krugman, Paul, 1991. "Increasing Returns and Economic Geography," Journal of Political Economy, University of Chicago Press, vol. 99(3), pages 483-99, June.
  2. Tuomas Pekkarinen, 2001. "The wage curve : evidence from the Finnish metal industry panel data," Finnish Economic Papers, Finnish Economic Association, vol. 14(1), pages 51-60, Spring.
  3. Hausman, Jerry & McFadden, Daniel, 1984. "Specification Tests for the Multinomial Logit Model," Econometrica, Econometric Society, vol. 52(5), pages 1219-40, September.
  4. Heckman, James J, 1979. "Sample Selection Bias as a Specification Error," Econometrica, Econometric Society, vol. 47(1), pages 153-61, January.
  5. Mincer, Jacob, 1978. "Family Migration Decisions," Journal of Political Economy, University of Chicago Press, vol. 86(5), pages 749-73, October.
  6. Carter, Thomas J., 1998. "Urban productivity, urban unemployment, and labor market policies," Regional Science and Urban Economics, Elsevier, vol. 28(3), pages 329-344, May.
  7. Karsten Albaek & Rita Asplund & Erling Barth & Stig Blomskog & Bjorn Runar Gudmundsson & Vifill Karlsson & Erik Strojer Madsen, 2000. "Dimensions of the Wage-Unemployment Relationship in the Nordic Countries: Wage Flexibility Without Wage Curves," Econometric Society World Congress 2000 Contributed Papers 1893, Econometric Society.
  8. Krugman, Paul & Venables, Anthony J, 1990. "Integration and the Competitiveness of Peripheral Industry," CEPR Discussion Papers 363, C.E.P.R. Discussion Papers.
  9. Jan K. Brueckner & Hyun-A Kim, 2001. "Land Markets in the Harris-Todaro Model: A New Factor Equilibrating Rural-Urban Migration," Journal of Regional Science, Wiley Blackwell, vol. 41(3), pages 507-520.
  10. Addison, John T & Portugal, Pedro, 1989. "Job Displacement, Relative Wage Changes, and Duration of Unemployment," Journal of Labor Economics, University of Chicago Press, vol. 7(3), pages 281-302, July.
  11. Thomas Krichel & Paul Levine, 1997. "The Welfare Economics of Rural to Urban Migration: The Harris-Todaro Model Revisited," School of Economics Discussion Papers 9702, School of Economics, University of Surrey.
  12. McCormick, Barry & Wahba, Jackline, 2000. "Did public wage premiums fuel agglomeration in LDCs?," Discussion Paper Series In Economics And Econometrics 0020, Economics Division, School of Social Sciences, University of Southampton.
  13. Arnott, Richard J & Gersovitz, Mark, 1986. "Social Welfare Underpinnings of Urban Bias and Unemployment," Economic Journal, Royal Economic Society, vol. 96(382), pages 413-24, June.
  14. Todaro, Michael P., 1976. "Urban job expansion, induced migration and rising unemployment : A formulation and simplified empirical test for LDCs," Journal of Development Economics, Elsevier, vol. 3(3), pages 211-225, September.
  15. Brueckner, Jan K. & Zenou, Yves, 1999. "Harris-Todaro models with a land market," Regional Science and Urban Economics, Elsevier, vol. 29(3), pages 317-339, May.
  16. Cole, William E & Sanders, Richard D, 1985. "Internal Migration and Urban Employment in the Third World," American Economic Review, American Economic Association, vol. 75(3), pages 481-94, June.
  17. Small, Kenneth A & Hsiao, Cheng, 1985. "Multinomial Logit Specification Tests," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 26(3), pages 619-27, October.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:fer:dpaper:310. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Anita Niskanen)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.