Rational Inattention and Migration Decisions

Simone Bertoli, Jesús Fernández-Huertas Moraga and Lucas Guichard ()
Additional contact information
Lucas Guichard: Institute for Employment Research (IAB), Nuremberg

No 13083, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Acquiring information about destinations can be costly for migrants. We model information frictions in the rational inattention framework and obtain a closed-form expression for a migration gravity equation that we bring to the data. The model predicts that ows from countries with a higher cost of information or stronger priors are less responsive to variations in economic conditions at destination, as migrants rationally get less information before deciding where to move. The econometric analysis reveals systematic heterogeneity in the pro-cyclical behavior of migration flows across origins that is consistent with the existence of information frictions.

Keywords: international migration; information; rational inattention; gravity equation (search for similar items in EconPapers)
JEL-codes: D81 D83 F22 (search for similar items in EconPapers)
Pages: 51 pages
Date: 2020-03
New Economics Papers: this item is included in nep-int, nep-mig, nep-upt and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (20)

Published - published in: Journal of International Economics, 2020, 126, 103364

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https://docs.iza.org/dp13083.pdf (application/pdf)

Related works:
Journal Article: Rational inattention and migration decisions (2020)
Working Paper: Rational inattention and migration decisions (2020)
Working Paper: Rational inattention and migration decisions (2019)
Working Paper: Rational inattention and migration decisions (2019)
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