Journal of Economic Perspectives
ISSN 0895-3309 (Print) | ISSN 1944-7965 (Online)
Urban-Rural Gaps in the Developing World: Does Internal Migration Offer Opportunities?
Journal of Economic Perspectives
(pp. 174–92)
(Complimentary)
Abstract
This article provides an overview of the growing literature on urban-rural gaps in the developing world. I begin with recent evidence on the size of the gaps as measured by consumption, income, and wages, and argue that the gaps are real rather than just nominal. I then discuss the role of sorting more able workers into urban areas and review an array of recent evidence on outcomes from rural-urban migration. Overall, migrants do experience substantial gains on average, though smaller than suggested by the cross-sectional gaps. I conclude that future work should help further explore the frictions—in particular, information, financial, and in land markets—that hold back rural-urban migration and may help explain the persistence of urban-rural gaps.Citation
Lagakos, David. 2020. "Urban-Rural Gaps in the Developing World: Does Internal Migration Offer Opportunities?" Journal of Economic Perspectives 34 (3): 174–92. DOI: 10.1257/jep.34.3.174Additional Materials
JEL Classification
- I12 Health Behavior
- I31 General Welfare; Well-Being
- O15 Economic Development: Human Resources; Human Development; Income Distribution; Migration
- O18 Economic Development: Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
- R12 Size and Spatial Distributions of Regional Economic Activity
- R23 Urban, Rural, Regional, Real Estate, and Transportation Economics: Regional Migration; Regional Labor Markets; Population; Neighborhood Characteristics