Regional income convergence, skilled migration and productivity response: Explaining relative stagnation in the periphery

Joern Rattsoe () and Hildegunn Stokke
Additional contact information
Joern Rattsoe: Department of Economics, Norwegian University of Science and Technology
Authors registered in the RePEc Author Service: Jorn Rattso

Working Paper Series from Department of Economics, Norwegian University of Science and Technology

Abstract: Most country growth experiences imply urbanization with labor migration from poor to rich regions and relative stagnation in the periphery. We study mechanisms holding back regional income convergence emphasizing the importance of productivity. Recent research has addressed the effects of labor mobility for income convergence in the neoclassical growth model, but finds that migration has limited effect on the convergence process. We build skilled labor migration into a multi-regional neoclassical growth model and assume that skilled labor affects productivity. The formulation takes advantage of open economy growth models where human capital influences innovation and technology adoption. Skilled labor outmigration from periphery regions reduces the capacity to generate productivity growth. Calibration of the regional growth model shows that skilled outmigration has quantitative importance for the growth performance of the periphery with realistic parameters. The analysis of the consequences of capital shock reproducing backwardness shows how migration equilibrium can be reestablished only after prolonged relative stagnation.

Pages: 26 pages
Date: 2009-01-27
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
http://www.svt.ntnu.no/iso/WP/2009/1_jrhs_region270109.pdf (application/pdf)

Related works:
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:nst:samfok:9809

Access Statistics for this paper

More papers in Working Paper Series from Department of Economics, Norwegian University of Science and Technology Contact information at EDIRC.
Bibliographic data for series maintained by Anne Larsen ().