Testing classic theories of migration in the lab

Catia Batista and David McKenzie

NOVAFRICA Working Paper Series from Universidade Nova de Lisboa, Nova School of Business and Economics, NOVAFRICA

Abstract: We test the predictions of different classic migration theories by using incentivized laboratory experiments to investigate how potential migrants decide between working in different destinations. We test theories of income maximization, migrant skill-selection, and multidestination choice as we vary migration costs, liquidity constraints, risk, social benefits, and incomplete information. We show the standard income maximization model of migration with selection on observed and unobserved skills leads to a much higher migration rate and more negative skill-selection than is obtained when migration decisions take place under more realistic assumptions. Second, we investigate whether the independence of irrelevant alternatives (IIA) assumption holds. We find it holds for most people when decisions just involve wages, costs, and liquidity constraints. However, once we add a risk of unemployment and incomplete information, IIA no longer holds for about 20 percent of our sample.

Keywords: Migrant selection; destination choice; lab experiment; IIA (search for similar items in EconPapers)
JEL-codes: C39 D12 I15 I18 O18 Q53 (search for similar items in EconPapers)
Pages: 47 pages
Date: 2021
New Economics Papers: this item is included in nep-exp, nep-isf, nep-lab and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

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Related works:
Journal Article: Testing classic theories of migration in the lab (2023)
Working Paper: Testing Classic Theories of Migration in the Lab (2021)
Working Paper: Testing Classic Theories of Migration in the Lab (2021)
Working Paper: Testing Classic Theories of Migration in the Lab (2021)
Working Paper: Testing Classic Theories of Migration in the Lab (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:unl:novafr:wp2111

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