Internal migration and human capital theory: To what extent is it selective?

Empirical studies of internal labor migration, modelling average outcomes, suggest migrants move to enhance returns to their labor. In contrast, major international surveys show less than a third of internal migrants as motivated by employment reasons. Using Swedish panel data for the years 2001-2009, this paper addresses this disconnect by examining the full distribution of migrant income changes. Results from initial CEM matching and quantile regression suggest that large returns to internal migration are mostly captured by the higher educated, those initially low in the income distribution and those heading into the largest metropolitan regions. Much if not most of migration outcomes are however a wash and indeed often negative in terms of pay-off. This suggests models of average outcomes as insufficient in addressing human capital motivated migration.

Related content: Working paper No. 244

Korpi, M. & Clark, W. A. V. (2015). Internal migration and human capital theory: To what extent is it selective?Economics Letters, 136: 31-34. DOI: 10.1016/j.econlet.2015.08.016