Migration, Human Capital, and Poverty in a Dual-Economy Model of a Developing Country

Paul Masson

No 2001/128, IMF Working Papers from International Monetary Fund

Abstract: The coexistence of urban and rural poverty and migration to cities is studied in a dual economy model where the acquisition of skills is costly and involves migration to urban areas. In this model, both the distribution of innate abilities and the distribution of wealth matter for the migration decision, and costs of backmigration may produce an urban poverty trap if unemployment lowers household wealth below the cost of skills acquisition.

Keywords: WP; unemployment rate; Gini coefficient; labor force; poverty trap; migration; poverty; development; migration decision; wealth accumulation; poverty issue; migration choice; utility function; opportunity cost; wealth accumulation dynamics; above-market-clearing wage; market clearing wage; further migration; sector wage; Wages; Human capital; Unemployment; Income; Africa; Asia and Pacific (search for similar items in EconPapers)
Pages: 36
Date: 2001-09-01
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Citations: View citations in EconPapers (13)

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