Urban-Rural Gaps in the Developing World: Does Internal Migration Offer Opportunities?

David Lagakos

Journal of Economic Perspectives, 2020, vol. 34, issue 3, 174-92

Abstract: This article provides an overview of the growing literature on urban-rural gaps in the developing world. I begin with recent evidence on the size of the gaps as measured by consumption, income, and wages, and argue that the gaps are real rather than just nominal. I then discuss the role of sorting more able workers into urban areas and review an array of recent evidence on outcomes from rural-urban migration. Overall, migrants do experience substantial gains on average, though smaller than suggested by the cross-sectional gaps. I conclude that future work should help further explore the frictions—in particular, information, financial, and in land markets—that hold back rural-urban migration and may help explain the persistence of urban-rural gaps.

JEL-codes: I12 I31 O15 O18 R12 R23 (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (65)

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DOI: 10.1257/jep.34.3.174

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