Essays in Migration Economics

Abstract

This dissertation studies the economic determinants of migration decisions. Chapter 1, joint with Eduardo Morales and Thomas Fujiwara, examines whether workers' limited migration responses to local shocks are due to lack of information about the potential gains from regional migration. We analyze the mobility decisions of all formally employed workers in Brazil over 15 years. We derive model-based moment conditions to test for the content of migrants' information sets. First, we find that individuals located in regions with a better access to internet and a higher population density have richer information sets overall. Second, information is concentrated on few neighboring regions and on regions with population sharing similar education and racial composition. Third, individuals identifying as white and with a higher educational attainment feature richer information sets.

Chapter 2 explores the consequences of this imperfect and heterogeneous information structure for the spatial allocation of economic activity and welfare. I develop a quantitative dynamic model of migration with costly information acquisition and local information sharing. Agents optimally acquire more information about nearby locations and learn about other locations from the migrants around them. After estimating the model from the Brazilian administrative data, I evaluate the counterfactual effect of the roll-out of broadband internet in Brazil. By allowing workers to make better mobility choices, expanding internet access increases average welfare, reduces migration flows by limiting mistakes and reduces the cross-sectional dispersion in earnings.

Chapter 3, joint with Hannah Rubinton and Clara Santamaría, studies the origins of large cities' attractiveness for migrants' career prospects. We investigate whether the different composition of establishment sizes between cities can help explain the city-size earnings premium. Using administrative data from Spain, we find that nearly a third of the short-term gains of moving to a city twice larger can be explained by a transition to a better-paying larger establishment. In contrast, only a small fraction of the medium-term gains of accumulating experience in a large city can be attributed to a faster transition to larger establishments. We conclude that the establishment size composition is fundamental for understanding the short-term gains of moving to a larger city.