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Stranded! How Rising Inequality Suppressed US Migration and Hurt Those Left Behind
Author:
Mr. Tamim Bayoumi
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Jelle Barkema null

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Series:
IMF Working Papers
Volume/Issue:
Volume 2019: Issue 122
Language:
English
Publication Date:
03 Jun 2019
DOI:
https://doi.org/10.5089/9781498311373.001
ISBN:
9781498311373
ISSN:
1018-5941
Pages:
34
Keywords:
WP; house price; Migration; Inequality; Economic; Opportunity; long-distance migration; income divergence; B. migration result; migration flow; income differential; life-cycle migration pattern; migration data; destination increase migration; house price differential; Housing prices; Personal income; Income inequality; Global
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IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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Using bilateral data on migration across US metro areas, we find strong evidence that increasing house price and income inequality has reduced long distance migration, the type most linked to jobs. For those migrating uphill, from a less to a more prosperous location, lower mobility is driven by increasing house price inequlity, as the disincentives from higher house prices dominate the incentives from higher earnings. By contrast, increasing income inequality drives the fall in downhill migration as the disincentives from lower earnings dominate the incentives from lower house prices. The model underlines the plight of those trapped in decaying metro areas—those “left behind”.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund