We estimate the aggregate productivity gains from reducing barriers to internal labor migration in Indonesia, accounting for worker selection and spatial differences in human capital. We distinguish between movement costs, which mean workers will only move if they expect higher wages, and amenity differences, which mean some locations must pay more to attract workers. We find modest but important aggregate impacts. We estimate a 22% increase in labor productivity from removing all barriers.
The Stanford Center on Global Poverty and Development curates working papers produced by Center faculty affiliates to showcase the wide range of development-oriented research.1 - 50 of 611 publications