— Many developing economies are undergoing urbanization processes through rural-urban migration. One of stylized facts in migration is that education is positively correlated with migration. This study investigates and tests the underlying cause of the positive education effects. In particular, using Heckman’s two step procedure, this study finds differential returns to human capital investment across education groups in urban areas of Indonesia. The results show that more educated people have a greater incentive to migrate to urban areas.
— Urbanization, migration, returns to education, human capital.
Sung Soo Lim is with the School of Business and Administration, American University in Dubai, Media City, UAE (e-mail: firstname.lastname@example.org).
Cite: Sung Soo Lim, " Urbanization and Returns to Human Capital Investment," Journal of Economics, Business and Management vol. 4, no. 2, pp. 144-148, 2016.