abstract

Comprehensive linked employer-employee data allow us to study the relationship between domestic formal sector migration in Brazil and globalization. Considerable worker flows in the formal labor market between 1997 and 2001 are directed toward lower income regions—the reverse flows of those often posited for informal labor markets. Estimation of the worker's multi-choice migration problem shows that previously unobserved employer covariates are significant predictors associated with migration flows. These results support the idea that globalization acts on internal migration through job stability at exporting establishments and employment opportunities at locations with a concentration of foreign owned establishments. A one percentage point increase in exporter employment predicts a 0.3 percentage point reduced probability of migration. A one percentage point increase in the concentration of foreign owned establishments at potential destinations is associated with a 0.2 percentage point increase in the migration rate.

keywords: Trade and labor market interactions; domestic and regional migration; multinational firms; Brazil

jel: F16, O15, F14

World Development 2010, 38(6): 840-856 [doi html]

background

• un wider working paper [rp2008/22] version