Factors related to internal migration in Brazil: how does a conditional cash-transfer program contribute to this phenomenon?

Luiz Gama, Cedeplar, UFMG
Ana Hermeto, Cedeplar, UFMG

As the Bolsa Família Program (BFP) has contributed to the decline in regional disparities and to improve social conditions in Brazil, it can be argued that it is possible that it is influencing individuals' decisions to migrate. We apply a hierarchical logit model, under the assumption that the probability of workers migrate differ among the municipalities. Data used are from the 2010 Brazilian Demographic Census (IBGE). Independent variables at the first level are: years of schooling, experience, age, dummy for race, dummy for gender, family income, marital status dummy, dummy for gender of the household head and status of beneficiary of the BFP. At the second level we use: average schooling, the ratio between the average income of the richest 20% and poorest 40%, per capita income and percentage of municipal income from government transfers. Results are: first, migrants are positively selected with respect to observable characteristics, in other words, are more educated and receive higher wages, and positively selected with respect to unobservable characteristics. Second, it is expected that the Bolsa Familia Program to reduce the likelihood of an individual migrate due to social and regional improvements, which mean retention effects. Third, it is expected that the receipt of the benefit increases the probability of return migration, because, due to the improvements brought about by social and regional program, individuals may conclude that the reasons that led them to migrate in the past (search for economic progress) can now be obtained from the place of origin. Finally, given that most of the benefits is intended to the Northeastern states it is expected that the effect of the program on migration is stronger in the municipalities of this region.