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Internal migration, regional labor markets and the role of agglomeration economies

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  • Timo Mitze
  • Torben Schmidt

Abstract

We analyze the determinants and regional implications of internal migration flows across Danish municipalities in 2006–2012. Besides assessing the role of labor market and housing market factors in driving a region’s net migration rate, we particularly focus on agglomeration factors identified by “new” migration theories related to regional growth models and the new economic geography. The work contributes to the field in the following way: we extend the scarce literature on the different channels through which agglomeration economies act as an attractor for mobile labor. Moreover, we account for the role of space–time dynamic adjustment processes and simultaneity among migration and labor market variables and finally test for heterogeneity in the migration response to regional labor market disparities among low- and high-skilled migrants. Our results support the view that agglomeration economies are indeed key drivers of internal migration flows in Denmark. That is, while we obtain mixed evidence with regard to the role of traditional labor and housing market variables, most of the included proxies for agglomeration economies such as the region’s population density, patent intensity, endowment with human capital as well as the region’s employment share of knowledge-intensive services are positively correlated with the region’s net in-migration rate. Regarding the regional implications of internal migration flows, the results hint at a process of cumulative causation for the time period of analysis running from agglomeration economies to the inflow of mobile labor and subsequent regional income development. Copyright Springer-Verlag Berlin Heidelberg 2015

Suggested Citation

  • Timo Mitze & Torben Schmidt, 2015. "Internal migration, regional labor markets and the role of agglomeration economies," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 55(1), pages 61-101, October.
    • Handle: RePEc:spr:anresc:v:55:y:2015:i:1:p:61-101
    DOI: 10.1007/s00168-015-0683-z
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    2. Seonghee Min & Saheum Hong, 2021. "Fighting the wrong battle: the effects of immigrant inflows on domestic migration of natives versus settled immigrants in the USA," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 66(1), pages 57-74, February.
    3. Timo Mitze, 2019. "The migration response to local labour market shocks: Evidence from EU regions during the global economic crisis," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 81(2), pages 271-298, April.
    4. Dimitris Kallioras & Vassilis Monastiriotis & George Petrakos, 2018. "Spatial dynamics and agglomeration forces in the external EU periphery," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 60(3), pages 591-612, May.

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    More about this item

    Keywords

    C23; R11; O31; J61;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers

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