Chapter 1. Migration Theory

This chapter provides a comprehensive expository survey and synthesis of the theoretical determinants of migration. Early work beginning with Adam Smith, running through the pioneering research of Larry Sjaastad in the 1960s, and continuing through the end of the twentieth century established the broad themes that persist in the literature. Migration is an act of human capital investment. Whether migration occurs across internal or international borders is largely irrelevant from a theoretical standpoint, as both types of flows are primarily driven by a desire to exploit geographic variation in the return to labor. We go on to show that while the earliest models treated migration as a static decision determined by exogenous wages that vary across different levels of human capital, more recent models emphasize the endogenous and dynamic nature of the migration decision and wages. We conclude the chapter with suggestions of further extensions of the human capital/migration model.