Where do Migrants Go? Risk-Aversion, Mobility Costs and the Locational Choice of Migrants

Francesco Daveri and Riccardo Faini

No 1540, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: As part of their effort to pool individual risk, households consider spreading their members over a plurality of locations, both inside and outside their country of origin. At the same time, the world is ridden with ‘Chinatowns’ and ‘Little Italies’: people, whenever they move, tend to bunch in the same location. Bunching would appear fundamentally at odds with the desire to diversify risk. In this paper we provide a framework to reconcile both spatial bunching and the spread of migrants, combining risk-aversion and concavity of mobility costs at the household level. Evidence from Southern Italy is consistent with the main predictions from our model.

Keywords: bunching; Migration; risk diversification (search for similar items in EconPapers)
JEL-codes: J61 O15 (search for similar items in EconPapers)
Date: 1996-12
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Citations: View citations in EconPapers (4)

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Working Paper: Where Do Migrants Go? Risk-Aversion, Mobility Costs and the Locational Choice of Migrants (1996)
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