Public Policy and Quality of Life: An Empirical Analysis of Interstate Migration, 2000-2012
26 Pages Posted: 28 Jul 2013
Date Written: May 22, 2013
Individuals and households choose their political jurisdiction of residence on the basis of expected income differentials and jurisdiction-specific characteristics covered by the general term "amenities.'' In addition to fixed characteristics like climate and terrain, amenities may include public policies, as in the well-known Tiebout model of migration. Do Americans reveal preferences for certain public policies by tending to migrate toward jurisdictions that offer them? This article tests whether state government involvement in fiscal policy, business regulation, and civil and personal liberties more often reflects an amenity or a disamenity for Americans willing to move. As identification strategies, the article estimates spatial, matched-neighbors, and dyadic models of net interstate migration for all 50 states, covering the years 2000-2012. The evidence suggests that cost of living, which is in turn strongly correlated with land-use regulation, strongly deters in-migration, while both fiscal and regulatory components of "economic freedom'' attract new residents. There is less robust evidence that "personal freedom'' attracts residents.
Keywords: migration, amenities, regulation, Tiebout sorting
JEL Classification: D19, H30, H73, H79, J18, J61, R11, R23
Suggested Citation: Suggested Citation