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Jul. 22nd, 2010 01:50 pm![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
alexsandroIn two seminal papers, Todaro (1969) and Harris and Todaro (1970) have
developed a canonical model of rural-urban migration. The main idea is quite
simple since it says that migration will occurs as long as the urban expected
income (i.e. income times the probability to find an urban job) is higher than
the rural one. These papers have been so influential that they are referred in
the literature to as the Harris-Todaro model. One of the main issues raised in
these papers was that creating urban jobs may increase rather than decrease
urban unemployment because of the induced negative effect on rural migration,
which may outweight the positive effect of creating jobs (Todaro, 1976). This
is referred to as the Todaro paradox.
The Todaro Paradox Revisited
Yves Zenou
IUI, GAINS and IZA Bonn
Discussion Paper No. 1861
developed a canonical model of rural-urban migration. The main idea is quite
simple since it says that migration will occurs as long as the urban expected
income (i.e. income times the probability to find an urban job) is higher than
the rural one. These papers have been so influential that they are referred in
the literature to as the Harris-Todaro model. One of the main issues raised in
these papers was that creating urban jobs may increase rather than decrease
urban unemployment because of the induced negative effect on rural migration,
which may outweight the positive effect of creating jobs (Todaro, 1976). This
is referred to as the Todaro paradox.
The Todaro Paradox Revisited
Yves Zenou
IUI, GAINS and IZA Bonn
Discussion Paper No. 1861
