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Transfer Arrangement, Labor Migration and Community Welfare

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  • Yamada, Daichi

Abstract

An informal transfer arrangement within a community redistributes incomes. While this may improve the welfare by mitigating the income inequality, it will also a ect households’ decisions on labor migration, a way to expand incomes. This paper theoretically examines the transfer arrangement that maximize the community welfare, taking into account its e ect on endogenous labor migration decisions. The result shows that the welfare is maximized when the redistribution through transfer is limited. It also presents an alternative explanation for empirical findings of limited transfer arrangement.

Suggested Citation

  • Yamada, Daichi, 2014. "Transfer Arrangement, Labor Migration and Community Welfare," Discussion paper series. A 272, Graduate School of Economics and Business Administration, Hokkaido University.
    • Handle: RePEc:hok:dpaper:272
    as

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    File URL: http://hdl.handle.net/2115/55296
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    File URL: https://eprints.lib.hokudai.ac.jp/dspace/bitstream/2115/55296/1/DPA272.pdf
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    References listed on IDEAS

    as
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    5. Coate, Stephen & Ravallion, Martin, 1993. "Reciprocity without commitment : Characterization and performance of informal insurance arrangements," Journal of Development Economics, Elsevier, vol. 40(1), pages 1-24, February.
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    Keywords

    Informal transfer; Labor migration;

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