Migration Under Uncertainty: “Try Your Luck” or “Wait and See”
Abstract:Two types of uncertainty enter into the migration decision. First, current conditions in the destination region may not be observable. Second, the future evolution of conditions in both the origin and destination regions may be unknown. The first type of uncertainty can encourage speculative or “try your luck” migration, whereas uncertainty about the future acts in the opposite direction, deterring relocation. This paper presents a dynamic optimizing model of migration that incorporates both types of uncertainty. The model shows that in equilibrium uncertainty about the future is likely to be more important than uncertainty about present conditions in the decision to relocate.
Document Type: Original Article
Affiliations: Economics Department, Harvard University, Cambridge, MA 02138, U.S.A. E-mail: email@example.com
Publication date: May 1, 1997