Williamson sees conventional wisdom as showing that rural emigration can reduce poverty for three reasons: first, migration to better jobs, second migration to a labor market which offers more effective life-cycle occupational “ladders,” and third, raising labor scarcity for those remaining behind. The author examines this conventional wisdom and its implications. Williamson stresses that one of the central premises of development economics is that industrialization makes it possible to transfer resources – mainly labor – from low agrarian to high industrial productivity. The author discusses this argument, looking at wage gaps, market labor failure and migration response. The chapter concludes with a discussion of policy intervention and price twist.
