On the Dynamics of Interstate Migration: Migration Costs and Self-Selection

No 3330, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This paper develops a tractable dynamic microeconomic model of migration decisions that is aggregated to describe the behavior of interregional migration. Our structural approach allows us to deal with dynamic self-selection problems that arise from the endogeneity of location choice and the persistency of migration incentives. Keeping track of the distribution of migration incentives over time has important consequences for the econometrical treatment, because the dynamics of this distribution influences the estimation of structural parameters, such as migration costs. For US interstate migration, we obtain a cost estimate of less than one-half of an average annual household income. This is substantially smaller than the migration costs estimated by previous studies. We attribute this difference to the treatment of the dynamic self-selection problem.

Keywords: indirect inference; dynamic self-selection; migration (search for similar items in EconPapers)
JEL-codes: C20 C61 J61 R23 (search for similar items in EconPapers)
Pages: 44 pages
Date: 2008-02
New Economics Papers: this item is included in nep-geo and nep-mig
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (13)

Published - published in: Review of Economic Dynamics, 2012, 15 (3), 377-401

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Related works:
Journal Article: On the Dynamics of Interstate Migration: Migration Costs and Self-Selection (2012)
Working Paper: On the Dynamics of Interstate Migration: Migration Costs and Self-Selection (2006)
Working Paper: On the Dynamics of Interstate Migration: Migration Costs and Self-Selection (2006)
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