We introduce the idea that informational cascades can explain the observed regularity that emigrants from the same locations also tend to choose the same foreign locations. Thus informational cascades generate herd behavior. Herd behavior is compared with the network externalities explanation of...

Migration networks are usually captured by the number of people from the migrant's country in the host region. Using Mexican migration data, we analyze the effects of the usual network variable and two additional origin-village-specific variables on migrants' location choice.

In this paper we examine possible network formations among immigrants and natives with endogenous investment. We consider a model of a network formation where the initiator of the link bears its cost while both agents benefit from it. We present the model by considering possible interactions...

Ethnic networks are a way of overcoming informal barriers to trade such as information costs, risk, and uncertainty by building trust and by substituting for the difficulty of enforcing contracts internationally. We study networks which emerge from the interaction (i) between migrants and...

In this paper, we present a formal framework of possible network formations among immigrants. After arriving in the new country, one of the new immigrant’s important decisions is with whom to maintain a link in the foreign country. We find that the behavior of the first two immigrants affects...