Housing Market Dynamics and Regional Migration in Britain
Gavin Cameron (deceased)
University of Oxford - Department of Economics (Deceased)
University of Oxford - Department of Economics; Centre for Economic Policy Research (CEPR)
University of Oxford - Nuffield College
CEPR Discussion Paper No. 5832
Economic conditions exert a strong influence on regional migration. On the one hand, strong labour market conditions, as exemplified by low unemployment rates and high earnings, draw migrants into regions. On the other hand, strong housing market conditions can prevent movement since expensive housing can deter migrants and commuting may often be an alternative. This can be thought of as giving rise to a migration equilibrium, where high house prices choke off migration caused by strong labour market conditions. Expected capital gains in housing and expected earnings growth however, can offset high levels of house prices, effects ignored in previous literature. Migration can also be influenced more directly by the availability of housing relative to population without this being mediated through prices. This paper presents evidence from a 28 year panel on net and gross migration for the regions of Britain that is broadly in accord with these expectations.
Number of Pages in PDF File: 57
Keywords: Regional migration, house prices, expected capital gains, contiguity, Great Britain, regional panel
JEL Classification: C33, J19, R3working papers series
Date posted: November 10, 2006
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