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Capital Market Imperfections, Labor Market Disequilibrium and Migration: A Theoretical and Empirical Analysis

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  • Morrison, Andrew R

Abstract

Traditional analyses of the determinants of migration in less developed countries have focused on labor-market conditions. This paper adapts a simple model to show that capital-market conditions may be an important factor in individuals' migration decisions. Data from Ecuador are used to test this model and the empirical results confirm the role of capital market imperfections, chiefly caused by financial repression, in shaping migration flows. Traditional labor-market factors still matter but the new finding may provide policymakers with new and lower-cost tools with which to affect migration outcomes. Copyright 1994 by Oxford University Press.

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  • Morrison, Andrew R, 1994. "Capital Market Imperfections, Labor Market Disequilibrium and Migration: A Theoretical and Empirical Analysis," Economic Inquiry, Western Economic Association International, vol. 32(2), pages 290-302, April.
    • Handle: RePEc:oup:ecinqu:v:32:y:1994:i:2:p:290-302
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    Cited by:

    1. Hagen-Zanker, Jessica, 2010. "Modest expectations: Causes and effects of migration on migrant households in source countries," MPRA Paper 29507, University Library of Munich, Germany.
    2. Hagen-Zanker, Jessica, 2008. "Why do people migrate? A review of the theoretical literature," MPRA Paper 28197, University Library of Munich, Germany.

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