Structural Change, Internal Migration, and Welfare: A Micro-Panel Data Evidence From Tanzania

This paper provides micro insights on structural change and internal migration and their effects on welfare in Tanzania, using household panel survey data, which was collected in 2015 and 2021. The results show that cross-sector labor movements are dominated by movements between agriculture and services, although most individuals studied within the two periods continue to remain in agriculture. We observe that the number of people who slid into poverty was nearly twice the number who escaped it, significantly driven by the pattern of sectoral transitions experienced by the individuals. The findings show that in addition to sectoral transitions and internal migration being important to each other, they are both driven by similar micro factors. The paper highlights the importance of education (particularly secondary or higher education) to increasing the chances of an individual embarking on welfare-enhancing sectoral movement and associated migration across districts in Tanzania.