Repercussions of negatively selective migration for the behavior of non-migrants when preferences are social

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Dokumentart: Article
Date: 2019-04-05
Source: University of Tübingen Working Papers in Economics and Finance ; No. 117
Language: English
Faculty: 6 Wirtschafts- und Sozialwissenschaftliche Fakultät
Department: Wirtschaftswissenschaften
DDC Classifikation: 330 - Economics
Keywords: Migration , Arbeitsleistung
Other Keywords:
Social preferences
Distaste for low relative income
Work effort
Per capita output
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We study how the work effort and output of non-migrants in a village economy are affected when a member of the village population migrates. Given that individuals dislike low relative income, and that migration modifies the social space of the non-migrants, we show why and how the non-migrants adjust their work effort and output in response to the migration-generated change in their social space. When migration is negatively selective such that the least productive individual departs, the output of the non-migrants increases. While as a consequence of this migration statically calculated average productivity rises, we identify a dynamic repercussion that compounds the static one.

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