EconPapers    
Economics at your fingertips  
 

How Borrowing Constraints Hinder Migration: Theoretical Insights from a Random Utility Maximization Model

Léa Marchal and Claire Naiditch ()

Scandinavian Journal of Economics, 2020, vol. 122, issue 2, 732-761

Abstract: We provide a theoretical framework to analyze how financial constraints hinder migration. Introducing wealth heterogeneity and borrowing constraints into a random utility maximization model of migration, we find evidence of multilateral resistance to migration stemming from borrowing constraints. We calibrate the model on 22 European countries, and we show that omitting the constraints biases upward the estimation of bilateral migration rates. We then simulate an increase in the bilateral cost of migration to the United Kingdom. We find that omitting the constraints biases downward the change entailed by the cost increase in the bilateral rates of migration to all destinations.

Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
https://doi.org/10.1111/sjoe.12355

Related works:
Working Paper: How Borrowing Constraints Hinder Migration: Theoretical Insights from a Random Utility Maximization Model (2019)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:scandj:v:122:y:2020:i:2:p:732-761

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0347-0520

Access Statistics for this article

Scandinavian Journal of Economics is currently edited by Richard Friberg, Matti Liski and Kjetil Storesletten

More articles in Scandinavian Journal of Economics from Wiley Blackwell
Bibliographic data for series maintained by Wiley Content Delivery ().

 
Page updated 2020-09-28
Handle: RePEc:bla:scandj:v:122:y:2020:i:2:p:732-761