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Structural Estimation and Interregional Labour Migration: Evidence from Japan

  • Keisuke Kondo

    (Graduate School of Economics, Kobe University)

  • Toshihiro Okubo

    (Faculty of Economics, Keio University)

This paper empirically tests relationships among interregional labour migration, wage, and real market potential (RMP) based on a multi-region economic geography model, which describes bilateral migration flows. We estimate a nonlinear gravity model using manufacturing workers' migration flows across the 47 Japanese prefectures. Estimates of structural parameters enable us to compute key variables of the model: price index, RMP, and real wage. We show that higher RMP regions can offer higher nominal wages. Furthermore, we find that an increase in the relative real wage of a region brings about a net increase in workers into the region.

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File URL: http://ies.keio.ac.jp/old_project/old/gcoe-econbus/pdf/dp/DP2011-040.pdf
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Paper provided by Keio/Kyoto Joint Global COE Program in its series Keio/Kyoto Joint Global COE Discussion Paper Series with number 2011-040.

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Length: 41 pages
Date of creation: Mar 2012
Date of revision:
Handle: RePEc:kei:dpaper:2011-040
Contact details of provider: Postal: 2-15-45, Mita, Minato-ku, Tokyo 108-8345
Phone: 81-3-3453-4511
Web page: http://ies.keio.ac.jp/old_project/old/gcoe-econbus/

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  1. H. Hanson, Gordon, 2005. "Market potential, increasing returns and geographic concentration," Journal of International Economics, Elsevier, vol. 67(1), pages 1-24, September.
  2. Mary Amiti & Lisa Cameron, 2007. "Economic Geography and Wages," The Review of Economics and Statistics, MIT Press, vol. 89(1), pages 15-29, February.
  3. TABUCHI, Takatoshi & THISSE, Jacques-François, 2001. "Taste heterogeneity, labor mobility and economic geography," CORE Discussion Papers 2001044, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  4. Maarten Bosker & Steven Brakman & Harry Garretsen & Marc Schramm, 2010. "Adding geography to the new economic geography: bridging the gap between theory and empirics," Journal of Economic Geography, Oxford University Press, vol. 10(6), pages 793-823, November.
  5. Laura Hering & Sandra Poncet, 2006. "Market Access Impact on Individual Wage: Evidence from China," Working Papers 2006-23, CEPII research center.
  6. Jordi Pons & Elisenda Paluzie & Javier Silvestre & Daniel A. Tirado, 2007. "Testing The New Economic Geography: Migrations And Industrial Agglomerations In Spain," Journal of Regional Science, Wiley Blackwell, vol. 47(2), pages 289-313, 05.
  7. Brakman, Steven & Garretsen, Harry, 2006. "New economic geography: Closing the gap between theory and empirics," Regional Science and Urban Economics, Elsevier, vol. 36(5), pages 569-572, September.
  8. repec:hal:journl:halshs-00096277 is not listed on IDEAS
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