Abstract:We argue that the cost of rural-urban migration may act as an effective entry deterrence for successful migration to the urban sector. This cost results in some form of price rationing as the cash holding of a typical rural household falls short of the required cost. We demonstrate that certain endogenous forces will mesh in with the government policies to generate cumulative improvements in terms of trade in favour of the rural sector. Such improvements in terms of trade are shown to close the gap between the… Show more
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