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dc.contributor.authorBurda, Michael C.
dc.date.accessioned2012-08-27T11:18:39Z
dc.date.available2012-08-27T11:18:39Z
dc.date.issued1995
dc.identifier.citationBurda, Michael C. 'Migration and the option value of waiting'. - Economic & Social Review, Vol. 27, No. 1, October, 1995, pp. 1-19, Dublin: Economic & Social Research Institute
dc.identifier.issn0012-9984
dc.identifier.urihttp://hdl.handle.net/2262/64775
dc.description.abstractMigration is an investment: it involves fixed, unrecoverable costs and uncertain future returns. If migration can be postponed, the option value of doing so may have positive value. Migration may not occur for a range of individuals who would otherwise migrate on a net present value basis. This paper models the migration decision using ideas developed by Pindyck (1991) and Dixit (1992). The option value of waiting is related to the interest rate, fixed costs, and especially uncertainty governing the evolution of income at home and abroad. The "bad news principle" predicts that only unfavourable states of the world will affect the value of the migration option. In a rational intertemporal equilibrium of two regional labour markets, low migration rates may coexist with large or even increasing current wage differentials.en
dc.language.isoen
dc.publisherEconomic & Social Studies
dc.sourceEconomic & Social Reviewen
dc.subjectMigrationen
dc.subjectLabour marketen
dc.subjectQuantitative methodsen
dc.subjectEmigrationen
dc.titleMigration and the option value of waiting
dc.typeJournal Article
dc.publisher.placeDublinen


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