On the relation between origin income and migration

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Abstract
While traditional migration theory suggests that the rate of migration is negatively related to income at the origin, many empirical studies of aggregate migration yield a non-significant or even a positive relation. This paper utilizes a simplified model of migration to demonstrate that one possible reason for such results is the imperfect capital market facing migrants. Higher average income at the origin may imply a higher number of individuals who have the cash resources to finance migration, thus generating a positive relation between regional income and migration. The conclusions suggest the use of non-linear specifications in empirical migration studies.