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Connecting lagging and leading regions : the role of labor mobility


  • Lall, Somik V.
  • Timmins, Christopher
  • Yu, Shouyue


How can policies improve the welfare of people in economically lagging regions of countries? Should policies help jobs follow people? Or should they enable people to follow jobs? In most countries, market forces have encouraged the geographic concentration of people and economic activities - policies that try to offset these forces to encourage balanced economic growth have largely been unsuccessful. However, policies that help people get closer to economic density have improved individual welfare. In this paper, the authors examine the migration decisions of working-age Brazilians and find that the pull of higher wages in leading regions has a strong influence on the decision to migrate. However, many people are also"pushed"to migrate, starved of access to basic public services such as clean water and sanitation in their hometowns. Although migration is welfare-improving for these individuals, the economy may end up worse off as these migrants are more likely to add to congestion costs in cities than to contribute to agglomeration benefits. Encouraging human capital formation can stimulate labor mobility for economic gain; and improving access to and quality of basic services in lagging regions will directly improve welfare as well as reduce the type of migration motivated by the search for life-supporting basic services.

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  • Lall, Somik V. & Timmins, Christopher & Yu, Shouyue, 2009. "Connecting lagging and leading regions : the role of labor mobility," Policy Research Working Paper Series 4843, The World Bank.
  • Handle: RePEc:wbk:wbrwps:4843

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    References listed on IDEAS

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    Cited by:

    1. Brueckner, Jan K. & Lall, Somik V., 2015. "Cities in Developing Countries," Handbook of Regional and Urban Economics, Elsevier.
    2. Barbara Dietz & Kseniia Gatskova & Achim Schmillen, 2011. "Migration and Remittances in Kazakhstan: First Evidence from a Household Survey," Working Papers 304, Leibniz Institut für Ost- und Südosteuropaforschung (Institute for East and Southeast European Studies).
    3. Charles Kunaka, 2011. "Logistics in Lagging Regions : Overcoming Local Barriers to Global Connectivity," World Bank Publications, The World Bank, number 2543, March.
    4. World Bank, 2012. "Arab Republic of Egypt - Reshaping Egypt's Economic Geography : Domestic Integration as a Development Platform, Volume 1," World Bank Other Operational Studies 11903, The World Bank.
    5. McHenry, Peter, 2013. "The relationship between schooling and migration: Evidence from compulsory schooling laws," Economics of Education Review, Elsevier, vol. 35(C), pages 24-40.
    6. World Bank, 2004. "Sri Lanka - Reshaping Economic Geography : Connecting People to Prosperity," World Bank Publications, The World Bank, number 21549, March.
    7. Batabyal, Amitrajeet A. & Beladi, Hamid, 2015. "Knowledge goods, ordinary goods, and the effects of trade between leading and lagging regions," Research Policy, Elsevier, vol. 44(8), pages 1537-1542.

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    Transport Economics Policy&Planning; Population Policies; Banks&Banking Reform; Labor Policies; Access to Finance;

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