Migration and natural increase in regional population influence the long-term development potential
of a nation. It is also true that the population in certain regions increases due to industrialization and
modernization in order to survive in the market economy. In contrast, some other regions become
relatively unattractive for labor to immigrate to, and these become isolated as compared to
neighboring regions.
In the scenario of economic growth of developing countries, through in-migration and
out-migration of labor, the distribution of population and wealth changes dramatically. This is one of
the reasons why policymakers, researchers, experts of official development assistance, and donors
are concerned about migration with a long-term vision for the sustainable economic development of
developing countries.
With the dynamic change in the structure of the labor force, migration is one of the most
difficult phenomena for researchers to estimate with a focus on the perspectives of the entire
country’s development. Because, even though classically economists adopted the view as expressed
in Hicks (1932), that “difference in net economic advantage, chiefly differences in wages, is the
main cause of migration,” there are also non-economic advantages that influence both in-migration
and out-migration of labor. According to modern economists, non-economic valuables and quality of
life indicators exert a statistically significant influence on migration. In other words, opportunity
costs such as cost of living differences, employment prospects, and public amenities such as
comfortable climate or sightseeing advantages have to be considered in the migration function to
measure the exact impact of economic factors—for example, to analyze how much high wage
expectation of the urban region impacts the inflow of workers into the region and how much
overpopulation of the rural region causes outflow of labor into other regions. For this purpose, Poot
(1986) used an aggregate data analysis of system approach and estimated the migration function for
New Zealand for the period 1971–76 with both social and economic factors included in the model.