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Inequality and Migration: A Behavioral Link

  • Stark, Oded

    (University of Bonn, University of Klagenfurt, University of Vienna, Warsaw University and ESCE Economic and Social Research Center, Cologne and Eisenstadt)

We provide an analytical-behavioral explanation for the observed positive relationship between income inequality, as measured by the Gini coefficient, and the incentive to migrate. We show that a higher total relative deprivation of a population leads to a stronger incentive to engage in migration for a given level of a population’s income; that total relative deprivation is positively related to the Gini coefficient; and that, consequently, the Gini coefficient and migration are positively correlated, holding the population’s income constant.

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File URL: http://www.ihs.ac.at/publications/eco/es-178.pdf
File Function: First version, 2005
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Paper provided by Institute for Advanced Studies in its series Economics Series with number 178.

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Length: 11 pages
Date of creation: Oct 2005
Date of revision:
Handle: RePEc:ihs:ihsesp:178
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  1. Lazear, Edward P & Rosen, Sherwin, 1981. "Rank-Order Tournaments as Optimum Labor Contracts," Journal of Political Economy, University of Chicago Press, vol. 89(5), pages 841-64, October.
  2. Luttmer, Erzo F. P., 2004. "Neighbors as Negatives: Relative Earnings and Well-Being," Working Paper Series rwp04-029, Harvard University, John F. Kennedy School of Government.
  3. David Andolfatto, 1999. "A Theory of Inalienable Property Rights," Working Papers 99004, University of Waterloo, Department of Economics, revised Nov 1999.
  4. Rosen, Sherwin, 1986. "Prizes and Incentives in Elimination Tournaments," American Economic Review, American Economic Association, vol. 76(4), pages 701-15, September.
  5. Oded Stark & You-qiang Wang, 2000. "A theory of Migration as a Response to Relative Deprivation," Departmental Working Papers _116, Chinese University of Hong Kong, Department of Economics.
  6. George J. Borjas, 1987. "Self-Selection and the Earnings of Immigrants," NBER Working Papers 2248, National Bureau of Economic Research, Inc.
  7. Thomas Liebig & Alfonso Sousa-Poza, 2004. "Migration, Self-Selection and Income Inequality: An International Analysis," Kyklos, Wiley Blackwell, vol. 57(1), pages 125-146, 02.
  8. Clark, Andrew E. & Oswald, Andrew J., 1996. "Satisfaction and comparison income," Journal of Public Economics, Elsevier, vol. 61(3), pages 359-381, September.
  9. Stark, Oded, 1990. "A Relative Deprivation Approach to Performance Incentives in Career Games and Other Contests," Kyklos, Wiley Blackwell, vol. 43(2), pages 211-27.
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