Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/295524 
Year of Publication: 
2015
Series/Report no.: 
CReAM Discussion Paper Series No. 16/15
Publisher: 
Centre for Research & Analysis of Migration (CReAM), Department of Economics, University College London, London
Abstract: 
We provide an explanation for the large spatial wage disparities and low male migration in India based on the trade-off between consumption-smoothing, provided by caste-based rural insurance networks, and the income-gains from migration. Our theory generates two key empirically-verified predictions: (i) males in relatively wealthy households within a caste who benefit less from the redistributive (surplus-maximizing) network will be more likely to migrate, and (ii) males in households facing greater rural income-risk (who benefit more from the insurance network) migrate less. Structural estimates show that small improvements in formal insurance decrease the spatial misallocation of labor by substantially increasing migration.
Document Type: 
Working Paper

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