Does migration arbitrage regional labor market differentials?

"This paper examines the determinants of regional migration [in the United States] in the 1980s using a place-to-place migration model in which migration flows depend upon the relative economic opportunities in the origin and destination regions. Using the results of the model, we then examine the potential role for migration in diffusing the economic pressures associated with disparate regional economic growth. Although the results reinforce the notion that divergent regional growth was an impetus to migration in the 1980s, estimates of the employment status of movers suggest that the true effects of migration on unemployment differentials may be quite small."     

Statistical inference,model selection and research experience: A multinomial model of data mining

The use of the same body of data to select a model and to estimate its parameters leads to an increase in the probability of committing a Type I error. Using a multinomial model of data mining, we show that as research experience increases, the probability of committing a Type I error decreases.     

Off‐farm wage returns to education: Evidence from Lesotho

This article presents estimates of off‐farm wage returns to education in rural areas of Lesotho. Results from a sample survey conducted in the northern Lowlands and Foothills of Lesotho indicate that returns to education are relatively higher for people wage‐employed in Lesotho than those wage‐employed as migrants in South Africa. For people working within Lesotho, education appears to have a significant and positive effect on off‐farm wages. Most people working within Lesotho are employed as teachers, nurses and civil servants and these job categories require an educated labour force. For people wage‐employed in South Africa, education appears not to have a significant effect on off‐farm wages. Most men working in South Africa are employed as labourers in mines while women working in South Africa are employed as domestic servants.     

The Causes and Consequences of Sectoral Reallocation: Evidence from the Early 21st Century

A number of industries underwent large and permanent reductions in employment growth at the beginning of this decade. We investigate the sources of these permanent changes in employment growth and what the consequences were for the U.S. economy. In particular, we find that relative declines in demand rather than technological innovations were the key drivers of the elevated levels of job destruction and permanent layoffs in the affected industries. In addition, most workers that were displaced in downsizing industries relocated to other sectors. While this process of reallocation led to large increases in productivity (and a reduction in labor's share of aggregate income) in industries shedding workers, it also resulted in prolonged periods of unemployment for many displaced workers, along with sizable reductions in earnings that were consistent with substantial losses in their specific human capital. Putting these pieces together, we estimate the costs to those adversely affected by these events to have been 1/2 percent to 1 percent of aggregate income per year.     

Long-run real exchange rates in the Four Little Dragons

This paper analyses changes in the exchange rate arrangements and policy and their impact on the long-run real exchange rates of the Asian Four Little Dragons. It is found that purchasing power parity is a basic guide in formulating the exchange rate policy of the Four Little Dragons and that exchange rate regimes are very responsive to the effect of major external disturbances on prices. Thus, the exchange rate policy and arrangements are important factors in shaping the behaviour of the real exchange rates of the FLDs, which tend to return to the long-run average value. To test the null hypothesis that purchasing power parity does not hold between the Four Little Dragons and the United States, two cointegration tests, the augmented Dickey-Fuller (ADF) test and the Johansen test, are applied. As the symmetry and proportionality conditions are not supported by the data, the tests are conducted in a trivariate system. While the ADF test does not support PPP, evidence of cointegration is found by the Johansen test.     

Financing of land purchase by small‐scale farmers

Binswanger attributes the problem facing poor people in financing land purchase to the inclusion of a real capital gains component in the price of land. This article attributes it largely to a cash flow problem which arises from positive inflation rates. The Ricardian rent return to land in South African agriculture is estimated at between 4 and 5 per cent while the Land Bank's interest rate is 15 per cent. Interest payments on a bond can therefore not be met from rents to land alone. If, as an extreme situation, the expected inflation rate were zero, farmers might have been able to borrow funds at 4 to 5 per cent. To bring debt servicing in line with projected cash flows in the real situation, mortgage interest rates could be subsidised; or, in an alternative affirmative action, the state could contribute towards the purchase price of land. These alternatives are discussed.     

Economic evaluation of a transport development programme for small‐scale cane‐growers

The cost‐benefit analysis procedure is used to determine the viability of a programme aimed at improving transport infrastructure for small‐scale cane‐growers. Two mill areas were evaluated, namely Amatikulu and Sezela, situated on KwaZulu‐Natal's north and south coasts respectively. Three models were constructed, as the Sezela area was subdivided into the Kwa‐Hlongwa (labour‐intensive) and Cabhane (plant‐hire) projects. The results reflecting the tangible costs and benefits indicate economic nett present values of R8,18 million, R7,91 million and R1,91 million for Amatikulu, Cabhane and Kwa‐Hlongwa respectively. In view of the results obtained in the base models and sensitivity analyses, indications are that the benefits of the programme will outweigh the costs by a considerable margin, making the programme a viable investment decision.