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The cost of migration
The cost of migration is an important migration-determining factor. In 1962, Sjaastad presented a human investment theory of migration, which treats the decision to migrate as an investment (Sjaastad, 1962). The returns are divided into money and non-money components. Non-money returns include changes in “psychological benefits” as a result of locational preferences. The psychological costs are associated with leaving familiar surroundings, in many cases of giving up one’s language and culture, adopting new dietary habits and social customs and growing out of one’s ethos.
Similarly, costs include both money and non-money costs. Money costs include all out-of-pocket expenses incurred in the process of moving, such as transport costs and additional food and lodging costs caused by migration (Tahmoures, 1984). Nonmoney costs involve opportunity costs of wages forgone while in transit, searching for work or retraining for a new job, if necessary. The distance of migration tends to increase forgone earnings, given the original area and the destination area levels of unemployment.
When a new job opportunity arises, households with members that have established, strong migration networks are the first to know and may be the first to take advantage of the opportunity, if they can afford the cost of claiming that opportunity. Migrant siblings tend to follow one another, the following migrants taking advantage of housing and employment contacts that the previous sibling(s) have made.
Members from poorer households may get the information later or may not have transport money immediately. Literature (Bilsborrow et al., 1997 and Bilsborrow, 1998) shows that as the migration stream settles some of the initial obstacles to movement, such as high transportation costs, tend to lessen or disappear. For instance, when the first migrants to an area provide passage money for family members left behind, as was the case with nineteenth-century Irish emigration to America, the result is chain migration (Balán, 1962). This ‘beaten path’ process often leads to a self-perpetuating flow of migration. This is particularly noteworthy when considering the importance of ‘information flow’ for potential migration. Land reform economists have looked at the cost of migration from a macroeconomic level and shown how expensive migration is relative to settling people on the land.
For example, Rosset (2001), using the Brazilian example, shows that estimates of the cost of creating a migrant’s job in the commercial sector of Brazil ranges from 2 to 20 times more than the cost of establishing an unemployed head of a household on farm land, through agrarian reform. This provides a powerful argument that land reform, geared towards creating a small farm economy, is good not only for local economic development but also good for more effective social policy. It is better than allowing the status quo to keep driving the poor out of rural areas in search of unavailable jobs in the cities.
Returns to migration
Part III of the model assesses the positive impacts of migration from the point of view of the household and the local economy. The details of this aspect of the analysis are adequately discussed in Chapter 3. It is sufficient to mention here that migration remittances compensate implicitly and explicitly for the loss of labour by adding to the income of the migrant-sending households, generating “income multipliers” in the migrant-sending economies, providing migrant-sending households with investment capital and increasing the demand for goods and services offered by others in the migrant-sending areas.
It is necessary to adopt a unitary (or common preference) approach to household resource allocation; that is, the exogeneity and aggregation of preferences across family members, income pooling and a strict comparative advantage approach to labour allocation decisions while at the same time allowing for self-interested factors.
In an arrangement where family members sacrifice their own income-earning potential, it is assumed that they will be compensated by sharing rules (altruism), which allow them to benefit from the overall higher household earnings. This is especially true for women members of the family who, in spite of their individual interest to migrate, may not be able to move away from home due to family responsibilities. The migration model constructed here considers individual and household characteristics. The dependent variable (MGRDMY) of the migration function at any period t is the rate at which rural people move away to urban areas, commercial farms or other areas in the informal sector. The independent variables are wage or income levels in both rural (agricultural) and urban, peri-urban or commercial farms sectors (Yrt and u t Y , where rt Y < u t Y ). In the case of the rural sector, such wage or income may be obtained in the form of farm income ( f Y ), self-employment income ( s Y ) and/or other income ( o Y ), such as off-farm wages and pension. Thus, r t Y may comprise farm income alone or a combination of the different forms of incomes, thus, rt Y represents the total sum of all rural household income sources. The other independent variables are the unemployment rate ( ut U ), an array of individual characteristics ( i X ), such as age, sex and education, and an array of household human characteristics ( rt H ), including age and education of household head, number of people of working age, household size and dependence ratio. Household capital factors ( rt K ) include land-holding, livestock, farm assets, assets used inside the house and financial assets made up of salaries, wages, pensions and other transfer payments. The subscripts r and u refer to agricultural or rural and urban, peri-urban or commercial farm areas, respectively. Lastly, we have an array of community characteristics ( rt C ), including accessibility (infrastructure), status of resources (landholding, water, grazing land, vegetation). Community characteristics would indicate what communities have in terms of natural resources, the environment surroundings them and how they can transform it into meaningful economic activities to secure their livelihood.
CHAPTER 1 INTRODUCTION
1.1 BACKGROUND
1.2 EVIDENCE OF RURAL INEQUALITY IN LIMPOPO
1.3 PROBLEM STATEMENT AND CONTEXT
1.4 THE THESIS AND RESEARCH OBJECTIVES
1.5 HYPOTHESES
1.6 DELIMITATION
1.7 ORGANISATION OF THE THESIS
CHAPTER 2 A REVIEW OF THE EFFECT OF RURAL INEQUALITY ON MIGRATION
2.1 INTRODUCTION
2.2 INTERNATIONAL EVIDENCE OF MIGRATION AND RURAL INEQUALITY
2.3 THE CAUSE AND EFFECT RELATIONSHIP BETWEEN INEQUALITY AND MIGRATION
2.4 RURAL INEQUALITY AND MIGRATION IN SOUTH AFRICA: PAST AND PRESENT
2.6 SUMMARY
CHAPTER 3 THEORIES OF INEQUALITY AND MODELS OF MIGRATION BEHAVIOUR
3.1 INTRODUCTION
3.2 Patterns and theories of inequality
3.3 THE BASIS FOR A LINK BETWEEN ASSET INEQUALITY AND MIGRATION
3.4 REVIEW OF SELECTED MIGRATION THEORIES AND MODELS
3.5 CAN MIGRATION PROVIDE A WINDOW OF OPPORTUNITY?
3.6 SUMMARY
CHAPTER 4 CONCEPTUAL FRAMEWORK
4.1 INTRODUCTION
4.2 KEY DEFINITIONS
4.3 FRAMEWORK FOR ANALYSING THE MIGRATION DECISION AND ITS IMPACT
4.4 FACTORS OR DETERMINANTS OF MIGRATION
4.5 SUMMARY
CHAPTER 5 RESEACH DESIGN
5.1 INTRODUCTION
5.2 THE STUDY AREA AND SAMPLE DESIGN
5.3 SAMPLING FRAME AND SURVEY DESIGN
5.4 QUESTIONNAIRE DESIGN AND DATA COLECTION
5.5 CATEGORIES OF THE MAIN VARIABLES
5.6 FRAMEWORK FOR DATA PREPARATION AND ANALYSIS
5.7 DATA ANALYSIS METHODS
5.8 SUMMARY
CHAPTER 6 CHARACTERISTICS AND IMPACT OF RURAL MIGRATION UNDER DIFFERENT ASSET DISTRIBUTION – A CASE STUDY OF LIMPOPO
6.1 INTRODUCTION
6.2 SOCIO-ECONOMIC CHARACTERISTICS OF THE SURVEY AREA
6.3 INFRASTRUCTURE AND NATURAL RESOURCE BASE
6.4 HOUSEHOLD CHARACTERISTICS
6.5 ASSET DISTRIBUTION
6.6 EXTENT OF MIGRATION IN LIMPOPO
6.7 DISTINCTION BETWEEN HOUSEHOLDS WITH AND WITHOUT MIGRANTS
6.8 SUMMARY
CHAPTER 7 RURAL ASSET INEQUALITY AND MIGRATION
7.1 INTRODUCTION
7.2 ESTIMATION STRATEGY AND EMPIRICAL ANALYSIS OF RURAL HOUSEHOLD ASSETS
7.3 DOES ASSET INEQUALITY CAUSE MIGRATION?
7.4 SUMMARY
CHAPTER 8 REMITTANCES AND RURAL INEQUALITY
8.1 INTRODUCTION
8.2 THE IMPORTANCE AND SHARE OF REMITTANCES IN HOUSEHOLD INCOME
8.3 ANALYTICAL FRAMEWORK
8.4 EMPIRICAL DERIVATION OF DECOMPOSED GINI INDICES
8.5 SUMMARY
CHAPTER 9 SUMMARY, CONCLUSIONS AND RECOMMENDATIONS
9.1 INTRODUCTION
9.2 RESULTING CONCLUSIONS
9.3 RECOMMENDATIONS
9.5 CONTRIBUTION OF THE STUDY
9.6 POSSIBLE QUESTIONS FOR FURTHER RESEARCH IN RURAL MIGRATION
REFERENCES
