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Matthew Kahn, Siqi Zheng The large productivity gaps across regions or sectors within developing countries create an enduring development puzzle: Why do workers remain in low productivity areas when they could experience wage gains elsewhere (Gollin et al. 2014)? It is important to understand the drivers of worker location choices, as migration has the potential to produce substantial economic gains. The literature proposes a few explanations for the low rates of within-country mobility observed across the world: migration costs may be high, migration may be risky, and potential migrants may lose something valuable that they possess at home, that they cannot easily take with them.

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