The Role of Risk Aversion and Uncertainty in Individual's Migration Decision

Tan Wang and Tony Wirjanto ()

No 98003, Working Papers from University of Waterloo, Department of Economics

Abstract: Building on recent advances in the theory of the optimal timing of investment under uncertainty, this paper proposes a stylized theoretical model to study an individual's optimal migration strategy. It shows that, as a result of following the optimal strategy, the individual may choose to delay the migration when the condition appears to be favorable, giving rise to so-called waiting phenomenon observed in the data for Germany following the unification. Using the closed-form solution obtained, it also examines how the duration of the waiting phenomenon is affected by a number of economic factors such as uncertainty with respect to income in Western Germany, the individual's attitude toward risk, etc.

Date: 1997-11, Revised 1997-11
References: Add references at CitEc
Citations: View citations in EconPapers (2)

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

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:wat:wpaper:98003

Access Statistics for this paper

More papers in Working Papers from University of Waterloo, Department of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Sherri Anne Arsenault ().