Connecting Lagging and Leading Regions : The Role of Labor Mobility
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 conce...
| Main Authors: | , , |
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| Format: | Policy Research Working Paper |
| Language: | English |
| Published: |
2012
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| Subjects: | |
| Online Access: | http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20090223160812 http://hdl.handle.net/10986/4038 |
| Summary: | 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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