Publication:
Spatial Development and Mobility Frictions in Latin America: Theory-Based Empirical Evidence

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dc.contributor.authorConte, Bruno
dc.contributor.authorIanchovichina, Elena
dc.date.accessioned2022-06-01T21:26:48Z
dc.date.available2022-06-01T21:26:48Z
dc.date.issued2022-05
dc.description.abstractUsing fine-grained spatial data and a dynamic spatial general equilibrium model, this paper assesses the magnitude of mobility frictions in Latin America as well as the effects of their reduction on spatial development in the region. The results suggest that in most Latin American countries, migration frictions calibrated based on spatially differentiated initial utility are on average smaller and less dispersed than those obtained assuming uniform within-country initial utility. A reduction in trade costs due to optimal investments in road infrastructure in most Latin American countries increases the present discounted value of real per capita income on average in the region by 15.1 percent. This effect is larger than the effects obtained with static quantitative trade models because of substantial dynamic gains. By contrast, a reduction in migration entry costs in the most productive and more populous locations in the Latin American countries has a negligible effect on the present discounted value of the region’s real per capita income, reflecting the relatively small dispersion in domestic migration frictions and their relatively low levels in top locations. In both counterfactuals, the welfare increases are significantly larger than the increases in real per capita output because the reductions in mobility frictions allow people to relocate to areas with better amenities and therefore derive higher utility. These results suggest that trade costs, not migration barriers, represent a major constraint to the efficient spatial distribution of economic activity and growth in Latin America.en
dc.identifierhttp://documents.worldbank.org/curated/en/099231306012226724/IDU040ec395c03220048480a53f05f73d2054bb7
dc.identifier.doi10.1596/1813-9450-10071
dc.identifier.urihttps://hdl.handle.net/10986/37497
dc.languageEnglish
dc.publisherWorld Bank, Washington, DC
dc.relation.ispartofseriesPolicy Research Working Papers;10071
dc.rightsCC BY 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo
dc.subjectECONOMIC GEOGRAPHY
dc.subjectLATIN AMERICA
dc.subjectMOBILITY FRICTIONS
dc.subjectTRADE COSTS
dc.subjectMIGRATION FRICTIONS
dc.subjectQUANTITATIVE TRADE MODELS
dc.subjectSPACIAL DEVELOPMENT
dc.subjectPRODUCTIVITY DIFFERENCES
dc.subjectWAGES
dc.subjectLABOR RATES
dc.titleSpatial Development and Mobility Frictions in Latin Americaen
dc.title.subtitleTheory-Based Empirical Evidenceen
dc.typeWorking Paperen
dc.typeDocument de travailfr
dc.typeDocumento de trabajoes
dspace.entity.typePublication
okr.date.disclosure2022-05-31
okr.date.lastmodified2022-05-31T00:00:00Zen
okr.doctypePolicy Research Working Paper
okr.doctypePublications & Research
okr.docurlhttp://documents.worldbank.org/curated/en/099231306012226724/IDU040ec395c03220048480a53f05f73d2054bb7
okr.guid099231306012226724
okr.identifier.doi10.1596/1813-9450-10071
okr.identifier.externaldocumentum33833730
okr.identifier.internaldocumentum33833730
okr.identifier.reportWPS10071
okr.importedtrueen
okr.language.supporteden
okr.pdfurlhttp://documents.worldbank.org/curated/en/099231306012226724/pdf/IDU040ec395c03220048480a53f05f73d2054bb7.pdfen
okr.region.administrativeLatin America and Caribbean
okr.topicInternational Economics and Trade::Economic Geography
okr.topicInternational Economics and Trade::Trade and Labor
okr.topicSocial Protections and Labor::Employment and Unemployment
okr.topicSocial Protections and Labor::Labor Markets
okr.topicSocial Protections and Labor::Wages, Compensation & Benefits
okr.unitChief Economist (LCRCE)
relation.isAuthorOfPublication814995f9-044c-566a-9355-890a6ac260ae
relation.isAuthorOfPublication.latestForDiscovery814995f9-044c-566a-9355-890a6ac260ae
relation.isSeriesOfPublication26e071dc-b0bf-409c-b982-df2970295c87
relation.isSeriesOfPublication.latestForDiscovery26e071dc-b0bf-409c-b982-df2970295c87
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