The Neoclassical Diligration And The Neo-Classical Equilibrium Theory

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The Neo-Classical Equilibrium
This theory describes where people are expected to move from low income to high income areas, it is possible from rural areas to urban areas, the general notion that migration movements tend regardless to a certain spatial-economic equilibrium (Castles & Miller 2003:22). Although the issue of migration has not attracted substantial attention within mainstream economic theory itself (Bauer & Zimmermann 1998:95; Lee 1966:48; Passaris 1989-7), in economics, genral equilibrium theory attempts to explain migration by geographical differences in the supply and demand for labour in economic ideology. The resulting differentials in wages cause workers to move from low-wage, labour-surplus regions to high-wage, labour
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(Todaro 1969:139), the expected income in the destination area not only depends on the actual (or average) earnings at the destination, but also on the probability of employment. The assumption is that, as long as rural-urban income differences remain high enough to outweigh the risk of becoming unemployed, the “lure of relatively higher permanent incomes will continue to attract a steady stream of rural migrants” (Todaro 1969:147). Neo-classical migration theory is also not able to deal with constraining factors such as government restrictions on migration. Neo-classical migration economy has also been criticized for being a-historical and Eurocentric, supposing that migration (i.e., the transfer of labour from agricultural rural to industrial urban sectors) fulfils the same facilitating role in the ‘modernization’ of currently developing countries as it did in nineteenth and twentieth century Europe. In fact, the structural conditions under which contemporary migration in and from developing countries takes place are rather different, although perhaps not …show more content…
For instance, under developed countries tends to have poor access to the resources and vise versa. Instead of modernizing and moving towards more advance economic development, underdeveloped countries are trapped by their disadvantaged position within the global geopolitical structure. Historical-structuralism has dominated migration research in the 1970s and most of the 1980s. There is increasing consensus that capitalism as such cannot be blamed for the problems of under development, but the specific developmental effects of incorporation of a region or country into the global capitalist system seems to depend much more on the conditions under which this takes place, that is, how the incorporation is embedded into wider institutional structures as well as the internal socio-political cohesion and economic strength of countries and regions. Thus, depending on these circumstances, the incorporation into global capitalism can have both positive and negative effects in different areas of development and on different groups of people within society. In the same vein, (labour) migration cannot automatically be interpreted as a desperate flight from misery, not only because it is seldom the poorest who migrate, but also because we can at least not logically rule out the possibility that migration facilitates development through

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