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Migration, sorting and regional inequality : evidence from Bangladesh

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  • Shilpi, Forhad

Abstract

Using household level data from Bangladesh, this paper examines the differences in the rates of return to household attributes over the entire welfare distribution. The empirical evidence uncovers substantial differences in returns between an integrated region contiguous to the country's main growth centers, and a less integrated region cut-off from those centers by major rivers. The evidence suggests that households with better observed and unobserved attributes (such as education and ability) are concentrated in the integrated region where returns are higher. Within each region, mobility of workers seems to equalize returns at the lower half of the distribution. The natural border created by the rivers appears to hinder migration, causing returns differences between the regions to persist. To reduce regional inequality in welfare in Bangladesh, the results highlight the need for improving connectivity between the regions, and for investing in portable assets of the poor (such as human capital).

Suggested Citation

  • Shilpi, Forhad, 2008. "Migration, sorting and regional inequality : evidence from Bangladesh," Policy Research Working Paper Series 4616, The World Bank.
  • Handle: RePEc:wbk:wbrwps:4616
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    References listed on IDEAS

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    1. Henry Overman & Patricia Rice & Anthony Venables, 2010. "Economic Linkages across Space," Regional Studies, Taylor & Francis Journals, vol. 44(1), pages 17-33.
    2. Nguyen, Binh T. & Albrecht, James W. & Vroman, Susan B. & Westbrook, M. Daniel, 2007. "A quantile regression decomposition of urban-rural inequality in Vietnam," Journal of Development Economics, Elsevier, vol. 83(2), pages 466-490, July.
    3. Marcel Fafchamps & Forhad Shilpi, 2005. "Cities and Specialisation: Evidence from South Asia," Economic Journal, Royal Economic Society, vol. 115(503), pages 477-504, April.
    4. Kevin Hjortshøj O'Rourke, 2015. "Economic Impossibilities For Our Grandchildren?," Economics Series Working Papers 139, University of Oxford, Department of Economics.
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    Cited by:

    1. Kazi Arif Uz Zaman & Takahiro Akita, 2011. "Spatial Dimensions of Income Inequality and Poverty in Bangladesh: An Analysis of the 2005 Household Income and Expenditure Survey Data," Working Papers EMS_2011_20, Research Institute, International University of Japan.
    2. repec:ris:badest:0530 is not listed on IDEAS
    3. repec:ris:badest:0540 is not listed on IDEAS
    4. Marcelo Bergolo & Fedora Carbajal, 2010. "Exploring the Urban-Rural Labor Income Gap in Uruguay: A Quantile Regression Decomposition," Revista de Analisis Economico – Economic Analysis Review, Ilades-Georgetown University, Universidad Alberto Hurtado/School of Economics and Bussines, vol. 25(2), pages 133-168, Diciembre.

    More about this item

    Keywords

    Population Policies; Access to Finance; Rural Poverty Reduction; Poverty Lines; Debt Markets;

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