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Research Seminars & Workshops @ IRES


Assistant Professor Maisy Wong
Department of Real Esatate,
University of Pennsylvania

Skill Transferability, Migration, and Development: Evidence from Population Resettlement in Indonesia


Date:

07 August 2014 (Thu)

Time:

4.00pm - 5.30pm

Venue:

AS2, #03-12, Lim Tay Boh Seminar Room


Abstract

Between 1979 and 1988, the Transmigration Program in Indonesia relocated two million voluntary migrants from the Inner Islands of Java and Bali to newly created rural settlements in the Outer Islands. We use the plausibly exogenous assignment of migrants to destinations in this large-scale policy experiment to estimate the causal impact of skill transferability across locations on aggregate productivity and local development outcomes in receiving areas. To proxy for migrants' skill transferability, we develop two measures that capture the agroclimatic and linguistic similarity between migrants' origins and destinations. This empirical strategy provides measurable and exogenous variation in comparative advantage, offering a novel solution to well-known identification problems in multi-sector Roy models. We find that Transmigration villages exhibit significantly higher agricultural productivity one to two decades later if they were assigned migrants from regions with more similar agroclimatic endowments and indigenous languages. Our results have important policy implications, suggesting that skill specificity may constrain labor reallocation across regions that differ in potential productivity and hence perceived arbitrage

About the Speaker

Maisy Wong is an Assistant Professor at the Wharton Real Estate Department, University of Pennsylvania. Her primary fields are urban and development economics, with research interests on migration, housing markets, and policy evaluations. She has published research articles in the Review of Economic Studies, AEJ: Applied Economics and Journal of Public Economics. Professor Wong received her Ph.D. in Economics from MIT

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