IDEAS home Printed from https://ideas.repec.org/a/wly/soecon/v72y2006i4p958-980.html
   My bibliography  Save this article

An SVAR Model of Fluctuations in U.S. Migration Flows and State Labor Market Dynamics

Author

Listed:
  • Mark D. Partridge
  • Dan S. Rickman

Abstract

Large internal migration flows are typically viewed as evidence of flexible U.S. labor markets adjusting to asymmetrical regional demand shocks. Yet, amenity‐induced migration flows suggest that they may not necessarily facilitate adjustment to demand shocks and instead may be destabilizing. This paper employs a structural vector autoregression model with long‐run identifying restrictions to account for both labor‐demand and labor‐supply shocks in examining the role of migration in U.S. regional labor‐market fluctuations. The results reveal that less than one‐half of innovations in state migration flows are responses to labor‐demand shocks. It is not until the third period that migrants fill a majority of demand‐induced jobs in a typical state, while it takes about 7 to 8 years for migration flows to fully adjust to labor‐demand shocks. The extent of the migration response also has implications for how much state and local economic development policies benefit original residents.

Suggested Citation

  • Mark D. Partridge & Dan S. Rickman, 2006. "An SVAR Model of Fluctuations in U.S. Migration Flows and State Labor Market Dynamics," Southern Economic Journal, John Wiley & Sons, vol. 72(4), pages 958-980, April.
    • Handle: RePEc:wly:soecon:v:72:y:2006:i:4:p:958-980
    DOI: 10.1002/j.2325-8012.2006.tb00748.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/j.2325-8012.2006.tb00748.x
    Download Restriction: no
    File URL: https://libkey.io/10.1002/j.2325-8012.2006.tb00748.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Blanchard, Olivier Jean & Quah, Danny, 1989. "The Dynamic Effects of Aggregate Demand and Supply Disturbances," American Economic Review, American Economic Association, vol. 79(4), pages 655-673, September.
    2. Decressin, Jorg & Fatas, Antonio, 1995. "Regional labor market dynamics in Europe," European Economic Review, Elsevier, vol. 39(9), pages 1627-1655, December.
    3. Borjas, George J & Freeman, Richard B & Katz, Lawrence, 1996. "Searching for the Effect of Immigration on the Labor Market," American Economic Review, American Economic Association, vol. 86(2), pages 246-251, May.
    4. Rappaport, Jordan, 2004. "Why are population flows so persistent?," Journal of Urban Economics, Elsevier, vol. 56(3), pages 554-580, November.
    5. Alfred Nucci & Charles Tolbert & Troy Blanchard & Michael Irwin, 2002. "Leaving Home: Modeling the Effect of Civic and Economic Structure on Individual Migration Patterns," Working Papers 02-16, Center for Economic Studies, U.S. Census Bureau.
    6. Timothy J. Bartik, "undated". "Who Benefits from Local Job Growth: Migrants or Original Residents?," Upjohn Working Papers tjb1993rs, W.E. Upjohn Institute for Employment Research.
    7. Greenwood, Michael J, et al, 1991. "Migration, Regional Equilibrium, and the Estimation of Compensating Differentials," American Economic Review, American Economic Association, vol. 81(5), pages 1382-1390, December.
    8. Graves, Philip E. & Mueser, Peter R., 1993. "The role of equilibrium and disequilibrium in modeling regional growth and decline: a critical reassessment," MPRA Paper 19915, University Library of Munich, Germany.
    9. Roback, Jennifer, 1982. "Wages, Rents, and the Quality of Life," Journal of Political Economy, University of Chicago Press, vol. 90(6), pages 1257-1278, December.
    10. Jimeno, Juan F. & Bentolila, Samuel, 1998. "Regional unemployment persistence (Spain, 1976-1994)," Labour Economics, Elsevier, vol. 5(1), pages 25-51, March.
    11. Carrington, William J, 1996. "The Alaskan Labor Market during the Pipeline Era," Journal of Political Economy, University of Chicago Press, vol. 104(1), pages 186-218, February.
    12. Hansson, Jesper, 1999. "Calculation of aggregate demand and supply disturbances from a common trends model," Economics Letters, Elsevier, vol. 65(3), pages 309-314, December.
    13. Timothy J. Bartik, 1991. "Who Benefits from State and Local Economic Development Policies?," Books from Upjohn Press, W.E. Upjohn Institute for Employment Research, number wbsle, November.
    14. Ciccone, Antonio & Hall, Robert E, 1996. "Productivity and the Density of Economic Activity," American Economic Review, American Economic Association, vol. 86(1), pages 54-70, March.
    15. Partridge, Mark D. & Rickman, Dan S., 2003. "The waxing and waning of regional economies: the chicken-egg question of jobs versus people," Journal of Urban Economics, Elsevier, vol. 53(1), pages 76-97, January.
    16. Quah, Danny, 1995. "Misinterpreting the dynamic effects of aggregate demand and supply disturbances," Economics Letters, Elsevier, vol. 49(3), pages 247-250, September.
    17. Randall W. Eberts & Joe A. Stone, 1992. "Wage and Employment Adjustment in Local Labor Markets," Books from Upjohn Press, W.E. Upjohn Institute for Employment Research, number wea, November.
    18. Stephen T. Marston, 1985. "Two Views of the Geographic Distribution of Unemployment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 100(1), pages 57-79.
    19. Faust, Jon & Leeper, Eric M, 1997. "When Do Long-Run Identifying Restrictions Give Reliable Results?," Journal of Business & Economic Statistics, American Statistical Association, vol. 15(3), pages 345-353, July.
    20. Card, David, 2001. "Immigrant Inflows, Native Outflows, and the Local Labor Market Impacts of Higher Immigration," Journal of Labor Economics, University of Chicago Press, vol. 19(1), pages 22-64, January.
    21. Evans, Philip & McCormick, Barry, 1994. "The New Pattern of Regional Unemployment: Causes and Policy Significance," Economic Journal, Royal Economic Society, vol. 104(424), pages 633-647, May.
    22. Eichengreen, Barry, 1993. "European Monetary Unification," Journal of Economic Literature, American Economic Association, vol. 31(3), pages 1321-1357, September.
    23. Balmaseda, Manuel & Dolado, Juan J & Lopez-Salido, J David, 2000. "The Dynamic Effects of Shocks to Labour Markets: Evidence from OECD Countries," Oxford Economic Papers, Oxford University Press, vol. 52(1), pages 3-23, January.
    24. Mark Partridge & Dan Rickman, 1997. "The Dispersion of US State Unemployment Rates: The Role of Market and Non-market Equilibrium Factors," Regional Studies, Taylor & Francis Journals, vol. 31(6), pages 593-606.
    25. Bayoumi, Tamim & Eichengreen, Barry, 1994. "Monetary and exchange rate arrangements for NAFTA," Journal of Development Economics, Elsevier, vol. 43(1), pages 125-165, February.
    26. Mark D. Partridge & Dan S. Rickman, 2002. "Did The New Economy Vanquish The Regional Business Cycle?," Contemporary Economic Policy, Western Economic Association International, vol. 20(4), pages 456-469, October.
    27. James H. Stock & Mark W. Watson, 2001. "Vector Autoregressions," Journal of Economic Perspectives, American Economic Association, vol. 15(4), pages 101-115, Fall.
    28. Gabriel, Stuart A. & Shack-Marquez, Janice & Wascher, William L., 1993. "Does migration arbitrage regional labor market differentials?," Regional Science and Urban Economics, Elsevier, vol. 23(2), pages 211-233, April.
    29. Edward L Glaeser & Jesse M Shapiro, 2003. "Urban Growth in the 1990s: Is City Living Back?," Journal of Regional Science, Wiley Blackwell, vol. 43(1), pages 139-165, February.
    30. Archibald, G C, 1969. "The Phillips Curve and the Distribution of Unemployment," American Economic Review, American Economic Association, vol. 59(2), pages 124-134, May.
    31. Hughes, Gordon & McCormick, Barry, 1994. "Did Migration in the 1980s Narrow the North-South Divide?," Economica, London School of Economics and Political Science, vol. 61(244), pages 509-527, November.
    32. Partridge, Mark D. & Rickman, Dan S., 1999. "Which comes first, jobs or people? An analysis of the recent stylized facts," Economics Letters, Elsevier, vol. 64(1), pages 117-123, July.
    33. Mueser Peter R. & Graves Philip E., 1995. "Examining the Role of Economic Opportunity and Amenities in Explaining Population Redistribution," Journal of Urban Economics, Elsevier, vol. 37(2), pages 176-200, March.
    34. Greenwood, Michael J & Hunt, Gary L, 1984. "Migration and Interregional Employment Redistribution in the United States," American Economic Review, American Economic Association, vol. 74(5), pages 957-969, December.
    35. Bound, John & Holzer, Harry J, 2000. "Demand Shifts, Population Adjustments, and Labor Market Outcomes during the 1980s," Journal of Labor Economics, University of Chicago Press, vol. 18(1), pages 20-54, January.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Rajbhandari, Isha & Faggian, Alessandra & Partridge, Mark D., 2022. "Oil and gas boomtowns and occupations: What types of jobs are created?," Energy Economics, Elsevier, vol. 115(C).
    2. Mark D. Partridge & Dan S. Rickman & M. Rose Olfert & Ying Tan, 2015. "When Spatial Equilibrium Fails: Is Place-Based Policy Second Best?," Regional Studies, Taylor & Francis Journals, vol. 49(8), pages 1303-1325, August.
    3. Björn Alecke & Timo Mitze & Gerhard Untiedt, 2010. "Internal migration, regional labour market dynamics and implications for German East-West disparities: results from a Panel VAR," Review of Regional Research: Jahrbuch für Regionalwissenschaft, Springer;Gesellschaft für Regionalforschung (GfR), vol. 30(2), pages 159-189, September.
    4. Monastiriotis, Vassilis & Kaplanis, Ioannis, 2011. "Flexible employment and cross- regional adjustment," Working Papers 2072/179671, Universitat Rovira i Virgili, Department of Economics.
    5. Mark Partridge & Dan Rickman, 2009. "Canadian regional labour market evolutions: a long-run restrictions SVAR analysis," Applied Economics, Taylor & Francis Journals, vol. 41(15), pages 1855-1871.
    6. Richard J. Cebula & J.R. Clark, 2011. "Migration, Economic Freedom, and Personal Freedom: An Empirical Analysis," Journal of Private Enterprise, The Association of Private Enterprise Education, vol. 27(Fall 2011), pages 43-62.
    7. Tervo, Hannu, 2016. "Do People Follow Jobs or Do Jobs Follow People? The Case of Finland in an International Context," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 46(1).
    8. Timothy W. Kelsey & Mark D. Partridge & Nancy E. White, 2016. "Unconventional Gas and Oil Development in the United States: Economic Experience and Policy Issues," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 38(2), pages 191-214.
    9. Daniel A. Broxterman & William D. Larson, 2020. "An empirical examination of shift‐share instruments," Journal of Regional Science, Wiley Blackwell, vol. 60(4), pages 677-711, September.
    10. Gunderson, Ronald J. & Pinto, James V. & Williams, Robert H., 2008. "Economic or Amenity Driven Migration? A Cluster-Based Analysis of County Migration in the Four Corners States," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 38(3), pages 1-12.
    11. Michael Landesmann & Sandra M. Leitner, 2015. "Labour Mobility of Migrants and Natives in the European Union: An Empirical Test of the 'Greasing of the Wheels’ Effect of Migrants," wiiw Working Papers 119, The Vienna Institute for International Economic Studies, wiiw.
    12. Cebula, Richard J. & Alexander, Gigi M., 2006. "Determinants of Net Interstate Migration, 2000-2004," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 36(2), pages 1-8.
    13. Gunderson, Ronald J. & Sorenson, David J., 2010. "An Examination of Domestic Migration from California Counties," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 40(1), pages 1-19.
    14. Juessen, Falko & Linnemann, Ludger, 2012. "Identifying Regional Labor Demand Shocks Using Sign Restrictions," IZA Discussion Papers 6767, Institute of Labor Economics (IZA).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Partridge, Mark D. & Rickman, Dan S., 2003. "The waxing and waning of regional economies: the chicken-egg question of jobs versus people," Journal of Urban Economics, Elsevier, vol. 53(1), pages 76-97, January.
    2. Mark D. Partridge & Dan S. Rickman & M. Rose Olfert & Ying Tan, 2015. "When Spatial Equilibrium Fails: Is Place-Based Policy Second Best?," Regional Studies, Taylor & Francis Journals, vol. 49(8), pages 1303-1325, August.
    3. Mark Partridge & Dan Rickman, 2009. "Canadian regional labour market evolutions: a long-run restrictions SVAR analysis," Applied Economics, Taylor & Francis Journals, vol. 41(15), pages 1855-1871.
    4. Mark Partridge & Dan Rickman, 2010. "Computable General Equilibrium (CGE) Modelling for Regional Economic Development Analysis," Regional Studies, Taylor & Francis Journals, vol. 44(10), pages 1311-1328.
    5. Partridge, Mark D. & Rickman, Dan S. & Olfert, M. Rose & Ali, Kamar, 2012. "Dwindling U.S. internal migration: Evidence of spatial equilibrium or structural shifts in local labor markets?," Regional Science and Urban Economics, Elsevier, vol. 42(1-2), pages 375-388.
    6. Détang-Dessendre, Cécile & Partridge, Mark D. & Piguet, Virginie, 2016. "Local labor market flexibility in a perceived low migration country: The case of French labor markets," Regional Science and Urban Economics, Elsevier, vol. 58(C), pages 89-103.
    7. David Philip Mcarthur & Inge Thorsen & Jan Ubøe, 2010. "A Micro‐Simulation Approach to Modelling Spatial Unemployment Disparities," Growth and Change, Wiley Blackwell, vol. 41(3), pages 374-402, September.
    8. Moretti, Enrico, 2011. "Local Labor Markets," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 4, chapter 14, pages 1237-1313, Elsevier.
    9. Mark D. Partridge, 2010. "The duelling models: NEG vs amenity migration in explaining US engines of growth," Papers in Regional Science, Wiley Blackwell, vol. 89(3), pages 513-536, August.
    10. repec:rre:publsh:v:33:y:2003:i:1:p:17-39 is not listed on IDEAS
    11. Greenaway-McGrevy, Ryan & Hood, Kyle K., 2016. "Worker migration or job creation? Persistent shocks and regional recoveries," Journal of Urban Economics, Elsevier, vol. 96(C), pages 1-16.
    12. McDuff, DeForest, 2011. "Demand substitution across US cities: Observable similarity and home price correlation," Journal of Urban Economics, Elsevier, vol. 70(1), pages 1-14, July.
    13. David McArthur & Inge Thorsen, 2011. "Determinants of internal migration in Norway," ERSA conference papers ersa10p532, European Regional Science Association.
    14. Mark Partridge & M. Rose Olfert & Alessandro Alasia, 2007. "Canadian cities as regional engines of growth: agglomeration and amenities," Canadian Journal of Economics, Canadian Economics Association, vol. 40(1), pages 39-68, February.
    15. Duranton, Gilles & Puga, Diego, 2014. "The Growth of Cities," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 2, chapter 5, pages 781-853, Elsevier.
    16. Timothy J. Bartik, 2015. "How Effects of Local Labor Demand Shocks Vary with the Initial Local Unemployment Rate," Growth and Change, Wiley Blackwell, vol. 46(4), pages 529-557, December.
    17. Hubert Jayet, 1996. "L'analyse économique des migrations, une synthèse critique," Revue Économique, Programme National Persée, vol. 47(2), pages 193-226.
    18. Michael Amior & Alan Manning, 2018. "The Persistence of Local Joblessness," American Economic Review, American Economic Association, vol. 108(7), pages 1942-1970, July.
    19. Mai Dao & Davide Furceri & Mr. Prakash Loungani, 2014. "Regional Labor Market Adjustments in the United States," IMF Working Papers 2014/211, International Monetary Fund.
    20. Mark D. Partridge & Dan S. Rickman & Kamar Ali & M. Rose Olfert, 2009. "Do New Economic Geography agglomeration shadows underlie current population dynamics across the urban hierarchy?," Papers in Regional Science, Wiley Blackwell, vol. 88(2), pages 445-466, June.
    21. Ernest Miguélez & Rosina Moreno, 2014. "What Attracts Knowledge Workers? The Role Of Space And Social Networks," Journal of Regional Science, Wiley Blackwell, vol. 54(1), pages 33-60, January.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:soecon:v:72:y:2006:i:4:p:958-980. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://doi.org/10.1002/(ISSN)2325-8012 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.