Skill Complementarities and Migration Decisions

Posted: 23 May 2001

See all articles by Mariassunta Giannetti

Mariassunta Giannetti

Stockholm School of Economics; Centre for Economic Policy Research (CEPR); European Corporate Governance Institute (ECGI); Swedish House of Finance

Date Written: Spring 2001

Abstract

This paper offers an explanation of the high mobility of skilled workers based on human capital complementarities. If the skill premium is increasing in the average level of human capital of a location, and there exist fixed migration costs, in equilibrium the more skilled the workers are, the stronger the economic incentives to migrate towards the richest regions will be. Moreover, endogenously generated differences in productivity due to migration affect occupational choices and regional specialization. Empirical evidence consistent with the proposed explanation is provided using data on Italian regions. It emerges that, even after controlling for economic conditions, a high population share of individuals who completed college or high-school in a region seems to be a relevant pull factor for the most educated migrants. In contrast, the importance of this variable, which measures the average level of human capital of a location, drops when unskilled migrants are considered. Finally, the effects of migration on the evolution of regional disparities are taken into account.

Keywords: Internal Migration, Skill Complementarities, Occupational Choices

JEL Classification: F2, O11, O15, O18

Suggested Citation

Giannetti, Mariassunta, Skill Complementarities and Migration Decisions (Spring 2001). Labour: Review of Labor Economics and Industrial Relations, Spring 2001. Available at SSRN: https://ssrn.com/abstract=265208

Mariassunta Giannetti (Contact Author)

Stockholm School of Economics ( email )

P.O. Box 6501
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SE-113 83 Stockholm
Sweden
+46 8 736 9607 (Phone)
+46 8 312 327 (Fax)

HOME PAGE: http://sites.google.com/site/mariassuntagiannetti/Home

Centre for Economic Policy Research (CEPR)

London
United Kingdom

European Corporate Governance Institute (ECGI)

c/o ECARES ULB CP 114
B-1050 Brussels
Belgium

HOME PAGE: http://www.ecgi.org

Swedish House of Finance ( email )

Drottninggatan 98
111 60 Stockholm
Sweden

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