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Rainfall, Internal Migration and Local labor Markets in Brazil

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  • Raphael Corbi

    ()

  • Tiago Ferraz

    ()

Abstract

We investigate the labor market impacts of weather-induced internal migration in Brazil between 1987 and 2010. We instrument the number of migrants at the destination municipalities using a two-step approach. First, we exploit the variation of out-migration flows from the Brazilian Semiarid, driven by deviations from historical average rainfall, to predict the number of internal migrants leaving their hometowns. Then, we distribute this predicted flow according to the preexisting support network in each destination based on the migrant’s region of origin. Our results indicate that increasing in-migration rate by 1ð ‘ .ð ‘ . reduces native employment by 0.3ð ‘ .ð ‘ ., mostly in the formal sector, decreases wages in the informal sector by 0.2% and deepens earnings inequality.

Suggested Citation

  • Raphael Corbi & Tiago Ferraz, 2018. "Rainfall, Internal Migration and Local labor Markets in Brazil," Working Papers, Department of Economics 2018_24, University of São Paulo (FEA-USP).
  • Handle: RePEc:spa:wpaper:2018wpecon24
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    File URL: http://www.repec.eae.fea.usp.br/documentos/Corbi_Ferraz_24WP.pdf
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    References listed on IDEAS

    as
    1. Rocha, Rudi & Soares, Rodrigo R., 2015. "Water scarcity and birth outcomes in the Brazilian semiarid," Journal of Development Economics, Elsevier, vol. 112(C), pages 72-91.
    2. Skoufias, Emmanuel & Vinha, Katja & Conroy, Hector V., 2011. "The impacts of climate variability on welfare in rural Mexico," Policy Research Working Paper Series 5555, The World Bank.
    3. Rita Almeida & Pedro Carneiro, 2012. "Enforcement of Labor Regulation and Informality," American Economic Journal: Applied Economics, American Economic Association, vol. 4(3), pages 64-89, July.
    4. Leah Platt Boustan & Price V. Fishback & Shawn Kantor, 2010. "The Effect of Internal Migration on Local Labor Markets:American Cities during the Great Depression," Journal of Labor Economics, University of Chicago Press, vol. 28(4), pages 719-746, October.
    5. Douglas Staiger & James H. Stock, 1997. "Instrumental Variables Regression with Weak Instruments," Econometrica, Econometric Society, vol. 65(3), pages 557-586, May.
    6. Kaivan Munshi, 2003. "Networks in the Modern Economy: Mexican Migrants in the U. S. Labor Market," The Quarterly Journal of Economics, Oxford University Press, vol. 118(2), pages 549-599.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Migration; labor supply; wage effects; rainfall;

    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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