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Why do people stay? Insider advantages and immobility

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  • Fischer, Peter A.
  • Holm, Einar
  • Malmberg, Gunnar
  • Straubhaar, Thomas

Abstract

The low mobility of people in Europe is considered a problem for adjustment to asymmetric shocks and regional convergence in the European Monetary Union. We suggest a complement to the traditional migration theories, the insider advantages approach to explain why most Europeans prefer to stay. Staying immobile they have accumulated work- and leisure-oriented insider advantages that are location-specific and would be lost in the case of emigration. Therefore, the longer people have stayed -and the more insider advantages they have accumulated-, the less likely they are to move. Using a new micro dataset covering all people resident in Sweden in 1994 and their mobility experience since 1985, we find a strong positive duration dependence of the probability to stay. Traditional micro-economic characteristics prove helpful in explaining immobility, while regional macro-economic differences have surprisingly little impact on individual mobility decisions. A large proportion of the moves between Swedish labour markets seem to be related to specific life-course events rather than to pure labour market issues. -- Wieso ist die Mobilität der Arbeitskräfte innerhalb der Europäischen Union - aller Freizügigkeit zum Trotz - so gering? Traditionelle Theorieansätze vermögen die schwach ausgeprägte Wanderungsintensität der EU-Angehörigen nur begrenzt zu erklären. Denn eigentlich sollten die teilweise beträchtlichen Einkommens- und Beschäftigungsunterschiede zu weit mehr Migration innerhalb der EU führen. In diesem Diskussionspapier entwickeln wir eine Idee, die sehr wohl zu erklären vermag, weshalb für die meisten Menschen "stehen" die bessere Alternative als "gehen" ist. Der Insider-Ansatz macht deutlich, weshalb für die individuelle Entscheidung eine grenz- und kulturraumüberschreitende Wanderung die Ausnahme und nicht die Regel ist. Die empirische Überprüfung mit Hilfe eines neuen originären Mikro-Datensets, das die gesamte schwedische Wohnbevölkerung enthält, bestätigt die These, dass die Verweildauer einen direkten positiven Einfluss auf die Verharrenswahrscheinlichkeit ausübt. Wer lange an einem Ort lebt, wird immer wahrscheinlicher an diesem Ort bleiben!

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Bibliographic Info

Paper provided by Hamburg Institute of International Economics (HWWA) in its series HWWA Discussion Papers with number 112.

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Date of creation: 2000
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Handle: RePEc:zbw:hwwadp:26310

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References

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  1. Burda,M.C., 1995. "Migration and the Option Value of Waiting," Papers 597, Stockholm - International Economic Studies.
  2. Faini, Riccardo & Galli, Giampaolo & Gennari, Pietro & Rossi, Fulvio, 1997. "An empirical puzzle: Falling migration and growing unemployment differentials among Italian regions," European Economic Review, Elsevier, vol. 41(3-5), pages 571-579, April.
  3. Laitila, Thomas, 1993. "A pseudo-R2 measure for limited and qualitative dependent variable models," Journal of Econometrics, Elsevier, vol. 56(3), pages 341-355, April.
  4. Gary S. Becker, 1962. "Investment in Human Capital: A Theoretical Analysis," Journal of Political Economy, University of Chicago Press, vol. 70, pages 9.
  5. Decressin, Jorg & Fatas, Antonio, 1995. "Regional labor market dynamics in Europe," European Economic Review, Elsevier, vol. 39(9), pages 1627-1655, December.
  6. Borjas, George J, 1985. "Assimilation, Changes in Cohort Quality, and the Earnings of Immigrants," Journal of Labor Economics, University of Chicago Press, vol. 3(4), pages 463-89, October.
  7. Ghatak, Subrata & Levine, Paul & Price, Stephen Wheatley, 1996. " Migration Theories and Evidence: An Assessment," Journal of Economic Surveys, Wiley Blackwell, vol. 10(2), pages 159-98, June.
  8. Stark, Oded & Helmenstein, Christian & Yegorov, Yuri, 1997. "Migrants' Savings, Purchasing Power Parity, and the Optimal Duration of Migration," Economics Series 44, Institute for Advanced Studies.
  9. repec:wop:humbsf:1995-58 is not listed on IDEAS
  10. Stark, Oded & Bloom, David E, 1985. "The New Economics of Labor Migration," American Economic Review, American Economic Association, vol. 75(2), pages 173-78, May.
  11. Amemiya, Takeshi, 1981. "Qualitative Response Models: A Survey," Journal of Economic Literature, American Economic Association, vol. 19(4), pages 1483-1536, December.
  12. Friedberg, Rachel M, 2000. "You Can't Take It with You? Immigrant Assimilation and the Portability of Human Capital," Journal of Labor Economics, University of Chicago Press, vol. 18(2), pages 221-51, April.
  13. Davidson, Russell & MacKinnon, James G., 1993. "Estimation and Inference in Econometrics," OUP Catalogue, Oxford University Press, number 9780195060119.
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Cited by:
  1. Kahanec, Martin & Zimmermann, Klaus F., 2008. "Migration in an Enlarged EU: A Challenging Solution?," IZA Discussion Papers 3913, Institute for the Study of Labor (IZA).
  2. Stephen Drinkwater, 2003. "Go West? Assessing the willingness to move from Central and Eastern European Countries," School of Economics Discussion Papers 0503, School of Economics, University of Surrey.
  3. Tanja El-Cherkeh & Max Steinhardt & Thomas Straubhaar, 2006. "Did the European Free Movement of Persons and Residence Directive Change Migration Patterns within the EU? A First Glance," CESifo DICE Report, Ifo Institute for Economic Research at the University of Munich, vol. 4(4), pages 14-20, 02.

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