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Development and Migration: Lessons from Southern Europe

Author

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  • Alessandra Venturini

    ()

  • Riccardo Faini

Abstract

Policy-makers in OECD countries appear to be increasingly concerned about growing migration pressure from developing countries. At the same, at least within Europe, they typically complain about the low level of internal labor mobility. In this paper, we try to shed some light on the issues of both internal and external labor mobility. We investigate the link between development and migration and argue, on both theoretical and empirical grounds, that it is likely be non linear. More precisely, we find that, in a relatively poor sending country, an increase in income will have a positive impact on the propensity to migrate, even if we control for the income differential with the receiving country, because the financial constraint of the poorest become less binding. Conversely, if the home country is relatively better off, an increase in income may be associated with a fall in the propensity to migrate even for an unchanged income differential. Econometric estimation for Southern Europe over the period 1962-1988 provides substantial support to this approach. We estimate first the level of income for which the financial constraint is no longer binding, around 950$, and then the level of income for which the propensity to migrate declines, which is around $ 4300 in 1985 prices. We therefore predict a steady decline in the propensity to migrate from Southern European countries. Similarly, our results highlight the possibility that the pressure to migrate from Northern African countries and other developing countries may increase with further growth.

Suggested Citation

  • Alessandra Venturini & Riccardo Faini, 2008. "Development and Migration: Lessons from Southern Europe," CHILD Working Papers wp10_08, CHILD - Centre for Household, Income, Labour and Demographic economics - ITALY.
  • Handle: RePEc:wpc:wplist:wp10_08
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    File URL: http://www.child.carloalberto.org/images/wp/child10_2008.pdf
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    References listed on IDEAS

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    Cited by:

    1. Alan Barrett & Irene Mosca, 2013. "The psychic costs of migration: evidence from Irish return migrants," Journal of Population Economics, Springer;European Society for Population Economics, vol. 26(2), pages 483-506, April.

    More about this item

    Keywords

    migration; growth;

    JEL classification:

    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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