Trade, Internal Migration, and Human Capital: Who Gains from India's IT Boom?

Abstract

The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent.

Technological Transitions with Skill Heterogeneity Across Generations

“…The only source of dynamics in our theory is the endogenous change in the distribution of skills across generations. This mechanism not only rationalizes the crossgeneration differences in occupation composition changes that we document, but it is also consistent with recent evidence on the impact of labor demand shocks on young individuals' decisions of educational attainment (Atkin, 2016 andCharles et al, 2018) and field of study (Abramitzky et al, 2019, Ghose, 2019. We add to this literature by documenting that cognitive-biased innovations cause higher training in cognitive-intensive occupations in Germany.…”

Global Economic Integration and Nativist Politics in Emerging Economies

“…Beyond China, an exogenous positive shock to the Indian information technology (IT) sector due to the Year 2000 Problem (Y2K) resulted in significant internal migration to take advantage of increased labor demand (Ghose 2021). Meanwhile, the entry of labor-intensive production in Brazil generated internal migration toward places in which global production agglomerated (Hering and Paillacar 2016).…”

“…As a result, most people are initially excluded from new global opportunities. These unequal concentrations of new employment increase the returns to geographic mobility, stimulating internal migration toward centers of export-oriented production (Facchini et al 2019;Ghose 2021;Hering and Paillacar 2016).…”

Skill-Biased Imports, Skill Acquisition, and Migration

“…Our main departure from these existing models is that, motivated by the research question, we incorporate endogenous skill acquisition. Other recent works that consider skill acquisition to spatial equilibrium models include Ghose (2021) and Hsiao (2022).…”