Understanding Migration Aversion Using Elicited Counterfactual Choice Probabilities

86 Pages Posted: 10 Apr 2019

See all articles by Gizem Koşar

Gizem Koşar

Federal Reserve Banks - Federal Reserve Bank of New York

Tyler Ransom

University of Oklahoma; Institute for the Study of Labor (IZA)

Wilbert van der Klaauw

Federal Reserve Bank of New York; IZA

Multiple version iconThere are 2 versions of this paper

Date Written: April 1, 2019

Abstract

Residential mobility rates in the United States have fallen considerably over the past three decades. The cause of the long-term decline remains largely unexplained. In this paper we investigate the relative importance of alternative drivers of residential mobility, including job opportunities, neighborhood and housing amenities, social networks, and housing and moving costs, using data from two waves of the New York Fed’s Survey of Consumer Expectations. Our hypothetical choice methodology elicits choice probabilities from which we recover the distribution of preferences for location and mobility attributes without concerns about omitted variables and selection biases that hamper analyses based on observed mobility choices alone. We estimate substantial heterogeneity in the willingness to pay (WTP) for location and housing amenities across different demographic groups, with income considerations, proximity to friends and family, neighbors’ shared norms and social values, and monetary and psychological costs of moving being key drivers of migration and residential location choices. The estimates point to potentially important amplifying roles played by family, friends, and shared norms and values in the decline of residential mobility rates.

Keywords: geographic labor mobility, migration, neighborhood characteristics

JEL Classification: D84, J61, R23

Suggested Citation

Koşar, Gizem and Ransom, Tyler and van der Klaauw, H. Wilbert, Understanding Migration Aversion Using Elicited Counterfactual Choice Probabilities (April 1, 2019). FRB of New York Staff Report No. 883, Available at SSRN: https://ssrn.com/abstract=3368408 or http://dx.doi.org/10.2139/ssrn.3368408

Gizem Koşar (Contact Author)

Federal Reserve Banks - Federal Reserve Bank of New York ( email )

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Tyler Ransom

University of Oklahoma ( email )

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H. Wilbert Van der Klaauw

Federal Reserve Bank of New York ( email )

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IZA ( email )

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