Residence and Workplace Relocation: A Bivariate Duration Model Approach

Different economic theories suggest that residential and labor market relocations are mutually related. This has been verified in various empirical studies. We analyze this relationship based on a bivariate duration model of residential and labor market mobility. This specification is motivated by a search model that allows for simultaneous search on the labor and housing market, taking commuting costs into account. We investigate this relationship by using information on job and residence durations. In order to be able to analyze properly empirical duration data, we derive the statistical distributions of interest. Our empirical results based on a Dutch sample of full-time employed workers show that residential and labor market mobility depend positively on one another, which is in line with the theoretical search model presented. Moreover, we present easy-to-interpret measures for this dependency.     

URBAN UNEMPLOYMENT AND THE SPATIAL STRUCTURE OF LABOR MARKETS: AN EXAMINATION OF THE “TODARO PARADOX” IN A SPATIAL CONTEXT*

ABSTRACT The Todaro paradox and the effects of job creation in urban areas will be re-examined in our spatial model in which the radius of the labor market is endogenously determined by the rational choices of workers. The travel cost of workers plays a crucial role in the choice between two different types of response, migration or commuting. By considering travel costs, we find that the Todaro paradox can be applied to developed, as well as developing, countries. Job creation in urban areas can produce a paradoxical increase in urban unemployment in developed countries, because the low marginal cost of travel will significantly increase the radius of the urban labor market and create new labor supply without migration.     

Analysis of Interregional Labor Migration in Spain Using Gross Flows

In this paper we study the economic determinants of Spanish interregional labor force flows from an aggregate perspective. The study is based on a matching model of the labor market applied to migration, and uses gross rather than net flows as other studies do. Among the main results, we find that unemployment increases out-migration because unemployed people search more actively, but when the unemployment rate is above a certain level this effect is reduced. We also find that the rate of change of relative wages is a significant determinant of migration in Spain.     

THE EFFECT OF URBANIZATION ON LABOR TURNOVER*

ABSTRACT The paper empirically examines labor market matching as a source of urban agglomeration economies. We work from the hypothesis that job turnover leads to tighter labor matches and estimate the relationship between urbanization and the job mobility of young men. Using a panel from the National Longitudinal Survey of Youth, we find evidence that young men change jobs more frequently in their early career if they live in larger or in more educated urban areas. The sensitivity of the results to whether the young men were “movers” or “stayers” suggests the possible endogeneity of location.     

Business dynamism,educational attainment,and residential location choice

Using individual-level, geocode data from the National Longitudinal Survey of Youth's 1997 cohort, I ask whether business dynamism in local labor markets, defined as the rates of job creation and establishment entry, affects the location decisions of labor force participants, and I examine how effects differ for highly and less educated labor force participants. I find that a one standard deviation increase in business dynamism is associated with a 2%–4% increase in the probability a college graduate chooses a metropolitan statistical area and an 8%–15% decrease for high school graduates with no college experience. These results support recent findings documenting a decrease in responsiveness to local labor market conditions and suggest that incentivizing job creation in local labor markets may not be enough to offset the trend of declining internal migration in the United States.     

Entry into working life: Internal migration and the job match quality of higher‐educated graduates

We estimate the impact of internal migration on job‐match quality for recent Dutch university and college graduates. We find positive yet modest wage returns. After controlling for the self‐selection of migrants with an IV approach, this effect is no longer significant for university graduates and all graduates from peripheral areas. We also find that, for our alternative job‐match measures, where there is evidence of migrant self‐selection, controlling for self‐selection strongly reduces the effect of internal migration on job‐match quality. In some cases, the returns on internal migration are found to be negative, which may signal forced migration.     

The spatial dimension of internal labor markets

We integrate into a unified framework the spatial and the employment dimensions of worker mobility, tracing workers across firms, across establishments, and across regions. Drawing upon the spatial dimension of internal labor markets in firms with multiple establishments in multiple locations, our results indicate that the contemporaneous wage premium to migration is around 3 percentage points. For the case of job switchers, we find that the return to regional migration is due to access to better jobs at the destination. We also document the existence of an urban premium for same‐employer migrants but for employer changes this premium is driven by selection.     

Destination choices of Chinese rural–urban migrant workers: Jobs,amenities, and local spillovers

Using the 2014 China Migrants Dynamic Survey, we analyze rural–urban migrant workers’ destination choices after the global financial crisis, with an emphasis on jobs, amenities, and local spillovers. By using an equilibrium‐sorting model, this paper disentangles local spillovers from local attributes in the estimation process. We employ both an artificial instrumental variable and the provincial highway passenger flow in 1979 to tackle the endogeneity issue. After controlling for the network effects of migrants from the same origin, we find a separate and strong preference for colocating with a large population of migrants, regardless of origin. The results remain robust when we take into account labor supply‐driven migration, spatial autocorrelation between provinces, different industry definitions, and regional differences within provinces. Our results imply that due to institutional barriers, the rural‐migrant community will still be a very important factor in the foreseeable future. In addition, as the ongoing industrial upgrading and transfer policies in China may lead to a westward movement of rural–urban migrants, the movement will be expedited when the older, less educated, or lower income migrants relocate.     

OUT-MIGRATION FROM MATLAB—A RURAL AREA OF BANGLADESH

Rural landlessness and pauperisation are ongoing processes in Bangladesh, forcing people to migrate to other areas or countries in search of a livelihood. The study estimates levels of and differentials in out-migration of adult Bangladeshis, and examines reasons for migration and place of destination, using longitudinally collected migration data in the International Centre for Diarrhoeal Disease Research, Bangladesh's (ICDDR,B's) Matlab surveillance area during the periods 1997–1999 and 2006–2008. The out-migration rate increased over time (48 per cent men versus 28 per cent women). Men migrated primarily for economic reasons (73–76 per cent), and women, for familial reasons (77–78 per cent). The younger, educated and well-off were more likely to migrate to urban areas and foreign countries than their older, less educated and poorer peers, who were more likely to migrate to other rural areas. Effective steps are needed to check rural-urban migration, and its numerous adverse consequences.     

AMENITIES VERSUS LABOR MARKET OPPORTUNITIES: CHOOSING THE OPTIMAL DISTANCE TO MOVE*

ABSTRACT. A recent debate in the regional economics literature has focused attention on the motivation behind an individual's decision to migrate. Human-capital migration models emphasize labor market disequilibria whereas alternative (hedonic) migration models stress households’altered demand for nontraded goods. In this paper, we test the relative importance of these two possible motivations for moving between metropolitan areas. We use an intercity hedonic model to decompose wages into equilibrium and disequilibrium components. We then compare the separate influences of amenities and the disequilibrium component of wages on the distance moved between two metropolitan areas. Our findings indicate that both economic factors and amenity differentials are significant factors in explaining regional migration.     

Polarization and the growth of low‐skill service jobs in Spanish local labor markets

This paper analyzes the long‐term transformations of the occupational structure in 50 provinces of Spain with a view to ascertain the existence and assess the extent of employment polarization. The peculiar characteristics of this country, namely rigid labor markets and the relatively recent transition to democracy, make for an interesting addition to existing studies on this topic. In line with previous literature on other countries, we find a strong association between the decline of “routine” mid‐skill jobs and the expansion of low‐skill service employment as well as differential labor market outcomes by levels of formal education. Results are robust to various controls and instrumental variables that account for long‐term industry specialization. We also find a positive local multiplier effect of high‐skilled workers on the demand for nontradable service jobs.     

COLLEGE-TO-WORK MIGRATION OF TECHNOLOGY GRADUATES AND HOLDERS OF DOCTORATES WITHIN THE UNITED STATES

ABSTRACT.  This study estimates a series of random parameter logit models of the college-to-work migration decisions of technology graduates and holders of doctorates within the United States. We employ detailed information on the migration-relevant characteristics of individuals, as well as on their actual origins and destinations at the metropolitan scale. In addition to its obvious implications for "brain drain" policies in U.S. metropolitan areas, the study demonstrates the richness of the random parameters technique for behavioral-geographic analysis. We find that science and technology graduates migrate to better educated places, other things equal; that PhD graduates pay greater attention to amenity characteristics than other degree holders; and that foreign students from some immigrant groups migrate to places where those groups are concentrated.     

LIFE CYCLE AND MIGRATION TO URBAN AND RURAL AREAS: ESTIMATION OF A MIXED LOGIT MODEL ON FRENCH DATA*

ABSTRACT This paper examines which types of individuals are attracted to or repelled from rural and urban areas in France. Migration decisions among urban centers, suburbs, and rural areas are examined for three age groups. Differences between locations are assumed to be driven by agglomeration economies and externalities resulting from densities. We therefore stress the role of labor‐market size, land markets, and commuting time in migration decisions. The results from multinomial mixed logits show that large labor markets attract the youngest and in particular educated individuals. Larger family size favors migration from city centers to suburbs, whereas divorce and widowhood increase the probability of moving to an urban center.     

Estimating the Marginal Willingness to Pay for Commuting

With informational frictions on the labor market, hedonic wage regressions provide biased estimates of the willingness to pay for job attributes. We show that a recent theoretical result, which states that the variation in job durations provides a basis for obtaining good estimates, can be generalized to a wide class of search models. We apply this result by estimating the marginal willingness of employed workers to pay for commuting, using Dutch longitudinal data. The average willingness to pay for one hour commuting is estimated to equal almost half of the hourly wage rate.     

Worker Endowments and the Effects of Institutions on Earnings Realization: A Cross-National Comparison

In this study we investigate how differential institutions, and their observance within regional labor markets, impact potential earnings realization. We investigate institutional linkages to labor market outcomes by means of cross-nation comparisons between the United States and the Netherlands. In this regard, better job-matching (information) programs, higher relative unemployment benefits and minimum wages, and a greater prevalence of both trade unionism and collective bargaining likely work to the favor of Dutch workers, and in turnaugment their reservation wages during job search. The predictable outcome of higher earnings realization among Dutch workers is tested econometrically by frontier estimation.     

ARE IMMIGRANTS MORE MOBILE THAN NATIVES? EVIDENCE FROM GERMANY

Low rates of internal migration in many European countries contribute to the persistence of significant regional labor market differences. I use the Mikrozensus, a large annual sample of households living in Germany, to further our understanding of the underlying reasons. This paper makes two main contributions: first, the paper quantifies the disutility of migrating. To this end, I estimate conditional logit models of the migration decision across the German federal states. Second, I then focus on the differences between immigrants and natives. I find significantly higher responsiveness to labor market differentials in the immigrant population than in the native population. Unobserved moving costs for immigrants are estimated to be only about 31 percent of this same cost for natives. The findings bear on the assessment of the economic impact of immigration, and the paper contributes to the current immigration‐related policy debates that feature prominently in many European countries, and that likely will continue to be important in light of the ongoing EU expansion and the resulting east–west migration.     

The Local Implications of Major Job Transformations in the City: A Spatial Microsimulation Approach

The changing dynamics of regional and local labor markets during the last decades have led to an increasing labor market segmentation and socioeconomic polarization and to a rise of income inequalities at the regional, urban, and intraurban level. These problems call for effective social and local labor market policies. However, there is also a growing need for methods and techniques capable of efficiently estimating the likely impact of social and economic change at the local level. For example, the common methodologies for estimating the impacts of large firm openings or closures operate at the regional level. The best of these models disaggregate the region to the city (Armstrong 1993; Batey and Madden 1983). This paper demonstrates how spatial microsimulation modeling techniques can be used for local labor market analysis and policy evaluation to assess these impacts (and their multiplier effects) at the local level‐to measure the effects on individuals and their neighborhood services. First, we review these traditional macroscale and mesoscale regional modeling approaches to urban and regional policy analysis and we illustrate their merits and limitations. Then, we examine the potential of spatial microsimulation modeling to create a new framework for the formulation, analysis and evaluation of social and local labor market policies at the individual or household level. Outputs from a local labor market microsimulation model for Leeds are presented. We show how first it is possible to investigate the interdependencies between individual's or households labor market attributes at the microscale and to model their accessibilities to job opportunities in different localities. From this base we show how detailed what‐if microspatial analysis can be performed to estimate the impact of major changes in the local labor market through job losses or gains, including local multiplier effects.     

Getting the first job: Size and quality of ethnic enclaves and refugee labor market entry

We analyze the relationship between residence in an ethnic enclave and immigrants' labor market integration with respect to finding a first job in the receiving country. The analysis distinguishes between the size and the quality of the ethnic enclaves, where quality is measured in terms of employment rate among ethnic peers in the same neighborhood. We use longitudinal geo‐coded registry data for two distinct groups of immigrants arriving in the Stockholm metropolitan area to investigate their initial labor market contact. The first group of immigrants moved from the Balkans in the early 1990s following the Yugoslavian war, and the second group arrived from the Middle East following the second Iraq War in 2006. We estimate the probability of finding a first job using probit regressions and complement the analysis with additional duration models. To draw causal inference, we use instrumentation that combines initial neighborhood variables with citywide variation over time. We provide empirical evidence that the employment rate of the respective immigrant group in the vicinity facilitates labor market integration of new immigrants. The influences of the overall employment rate and the share of conationals in the neighborhood tend to be positive, but less robustly so. Our results are consistent with the notion that the qualitative nature of an enclave is at least as important as the sheer number of ethnic peers in helping new immigrants find jobs.     

Public policy,local labor demand,and migration in Sweden, 1979-84

"A model of private local labor demand and interjurisdictional migration is presented and estimated using data from Swedish counties and municipalities for 1979-84. Our goal is to compare the effects on local labor markets of distinctive public-sector programs with those of traditional market variables. We find that local income taxes and tax-equalization grants have important effects on local labor markets; regional development policy measures and geographical-mobility subsidies do not. Thus, recent efforts scaling back some of these programs may not materially alter the regional economy's performance. Wages and other traditional market variables are also often found to influence significantly local labor markets."     

Employment Opportunities,Wages and International Migration in Sweden 1970–1989

In this study I focus on the impact of aggregate labor turnover and regional labor market conditions on gross in- and out-migration within the framework of a neoclassical flexible-wage (equilibrium) model and a fixed-wage (labor-market disequilibrium) model. Using annual panel data on internal gross migration flows in Sweden from 1970 to 1989, I find that regional differences in employment opportunities have the expected effects on migration. The empirical relationship between real wages and gross migration flows is found to be less congruent with theory implications, indicating that compensated regional income prospects are equalized primarily via the interaction between employment opportunities and gross migration flows. Cyclical changes in hirings are shown to have a robust and strongly significant positive scale effect on migration.