Where do migrants go?

In this paper, we study migration decisions taken by risk-averse households . Aggregate data from the regions of Southern Italy are used to test whethe r risk is a significant determinant of the decision to migrate abroad or in side the country. This indeed appears to be the case for both foreign and d omestic migrations, after controlling for unemployment and wage differentia ls and other plausible control variables. We interpret our results as evide nce that, whereas financial markets are absent or malfunctioning, migration provides a shelter against uncertain income prospects.