Social influence, agent heterogeneity and the emergence of the urban informal sector

Authored by Cesar Garcia-Diaz, Ana I. Moreno-Monroy

Date Published: 2012-02-15

DOI: 10.1016/j.physa.2011.08.057

Sponsors: Flanders Research Foundation Antwerp Centre of Evolutionary Demography (ACED)

Platforms: No platforms listed

Model Documentation: Other Narrative Mathematical description

Model Code URLs: Model code not found

Abstract

We develop an agent-based computational model in which the urban informal sector acts as a buffer where rural migrants can earn some income while queuing for higher paying modern-sector jobs. In the model, the informal sector emerges as a result of rural-urban migration decisions of heterogeneous agents subject to social influence in the form of neighboring effects of varying strengths. Besides using a multinomial logit choice model that allows for agent idiosyncrasy, explicit agent heterogeneity is introduced in the form of socio-demographic characteristics preferred by modern-sector employers. We find that different combinations of the strength of social influence and the socio-economic composition of the workforce lead to very different urbanization and urban informal sector shares. In particular, moderate levels of social influence and a large proportion of rural inhabitants with preferred socio-demographic characteristics are conducive to a higher urbanization rate and a larger informal sector. (C) 2011 Elsevier B.V. All rights reserved.

Tags

Agent-based modeling Rural-urban migration Adaptation and self-organizing systems Physics and society