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The (Un)importance of Geographical Mobility in the Great Recession"

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  • Siddharth Kothari

    (Stanford University)

  • Itay Saporta Eksten

    (Stanford University)

  • Edison Yu

    (Stanford University)

Abstract

Unemployment during and after the Great Recession has been persistently high. One concern is that the housing bust reduced geographical mobility and prevented workers from moving for jobs. We characterize flows out of unemployment that are related to geographical mobility to construct an upper bound on the effect of mobility on unemployment between 2007 and 2012. The effect of geographical mobility is always small: Using pre-recession mobility rates, decreased mobility can account for only an 11 basis points increase in the unemployment rate over the period. Using dynamics of renter geographical mobility in this period to calculate homeowner counterfactual mobility, delivers similar results. Using the highest mobility rate observed in the data, reduced mobility accounts for only a 33 basis points increase in the unemployment rate. (Copyright: Elsevier)

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File URL: http://dx.doi.org/10.1016/j.red.2013.03.002
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Bibliographic Info

Article provided by Elsevier for the Society for Economic Dynamics in its journal Review of Economic Dynamics.

Volume (Year): 16 (2013)
Issue (Month): 3 (July)
Pages: 553-563

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Handle: RePEc:red:issued:12-205

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Keywords: Mobility; Unemploymentl; Great Recession; Geographical Mismatch; Stock-flow equations;

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