Migration Liquidity and Retention Duality
RCTReview
Extreme poverty can either force individuals to migrate out of distress or prevent them from migrating due to an inability to pay travel and relocation costs. Public works programs alter spatial labor mobility in opposing ways depending on whether local wages relieve travel liquidity constraints or substitute for distress migration.
Picture this
Imagine a family living in an isolated village with no money. If they receive cash from a public works program, they can finally afford bus tickets to move to a big city for better opportunities. But if another family was planning to leave the village solely because there were no jobs, giving them a reliable government job right at home makes them stay.
What the evidence says
In Comoros, cash earned through workfare enabled marginalized groups to fund previously unaffordable migration costs; in India, NREGA work opportunities available close to home significantly reduced internal labor migration out of rural areas.
- Who was studied
- Rural households in Comoros and rural participants under India's National Rural Employment Guarantee Act (NREGA).
- How
- Randomized controlled trial tracking migration expenditures in Comoros alongside spatial equilibrium econometric modeling of internal migration patterns in India.
What to do
Assess local liquidity constraints versus distress migration rates before launching public works programs to predict whether regional labor mobility will increase or decrease.
From the source
"When researchers tracked participant savings in Comoros, participants' increased resources helped unlock migration opportunities for marginalized groups who would otherwise not be able to afford migration expenses. However, in a quasi-experimental study from India, researchers found that the PWP decreased internal migration using spatial modeling techniques."
Public works programs and labor market outcomes.pdf