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Factors Related To The Neoclassical Theory Of Migration

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A lot of theories have been propounded to give basis for international migration in modern times. Migration is the movement of people from the rural area to urban centres, and from less developed countries to more resourced-endowed economies primarily to seek for economic opportunities or run away from war or famine. Among the proposed theories is the neoclassical theory of migration which was rooted in models designed to enhance the appreciation of internal labour migration in the economic development process (Hicks, 1932; Lewis, 1954; Harris and Todaro, 1970). Assuming full employment, the theory proposes a linear relationship between wages and migration flows (Massey et al, 1993; Borjas, 2008). This theory argues that international migration…show more content…
In this theory, international migration is seen as investment in human capital where investors (migrants in this case) migrate to countries where they anticipate high productivity given their knowledge and skill base. Before migrating, potential migrants analyse the travelling costs, maintenance cost, the cost of waiting period, efforts in learning new language and culture, cost of adaptation as well as the psychological cost of severing relationship with old friends and forming new ones (Todaro and Maruszko, 1987). In addition, wages on employment as well as the availability of job given the set skills of the migrant is also considered. Again, potential migrants look at the opportunity of getting education, skills, training, experience, and a second language and compare their intended destination country with other countries. It is only when the potential migrant has undertaken all these analysis and has come to the conclusion that the expected net returns to migration is worth the movement, then will migration take place. This argument was supported by Sjaastad (1962), who argued that migration is conceptualized as investment in human capital where potential migrants calculate the value of existing opportunities in every likely
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