Full paper here: t.co/Kt9jBQ7Y0i

Based on a brand new dynamic model of firms with informality, we show that the informal sector acts as a stepping-stone to formality, but also reduces the economic gains from migration in equilibrium.

Downward nominal wage rigidity in the formal sector is key to this result: the effects are weaker in the short-run, when real wages cannot adjust with inflation, or in places where minimum wages are more binding.

Do you expect rural-urban migration to increase urban informality in developing countries? Our forthcoming paper at @ecmaeditors.bsky.social with @gulyssea.bsky.social finds the opposite. We show that between 2000 and 2010 drought-induced migration decreased informality in Brazilian cities.

Thank you!

The Department of Economics at Sciences Po is hiring! This year we have two Assistant Professor positions, one in any field and one in IO. Please apply here econjobmarket.org/positions/11... to join us www.sciencespo.fr/department-e...

#EconSky #EconConf

And if like me you are at the intersection of the two, your month of September will be busy 😀

And if you are doing research on development and migration do not miss the JULY 15th deadline for the Migration and Development Conference!

Conference deadlines approaching! If you are doing research on environmental issues, don't miss the JULY 14th deadline for the LSE Environment week www.lse-environment-week.com/environment-....