Financial Constraints, Endogenous Educational Choices and Self-Selection of Migrants
Juliano J. Assunção
Pontifical Catholic University of Rio de Janeiro (PUC-Rio) - Department of Economics
affiliation not provided to SSRN
May 15, 2010
RAND Working Paper Series WR- 758
The Roy model predicts that migrants will be disproportionately drawn from the lower half of the educational distribution of the sending country if the sending country has a higher return to schooling. However, Mexican immigrants in the U.S. tend to be disproportionately drawn from the middle of the distribution. This paper argues that financial constraints may explain why. It studies migrants' selectivity when agents that face credit constraints make joint decisions about how much to invest in education and whether to migrate. The results show that financial constraints can explain the intermediate selection of migrants observed in the data.
Number of Pages in PDF File: 28
Keywords: migration, financial constraints, self-selection, human capital
JEL Classification: O15, O16, R23working papers series
Date posted: June 16, 2010
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