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Policy-induced Migration in Canada: An Empirical Study

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Abstract

We investigate the influence of public policy on interregional migration in Canada using new interprovincial migration data constructed from personal income tax files for the years 1974 to 1996. We consider the consequences for gross and net migration flows of regional variation in employment insurance, provincial social assistance, personal income taxes and public spending of different types, and we compare the effects of these policies to the impacts on migration of wages, employment prospects and moving costs. We also conduct a preliminary investigation of the migration consequences of certain extraordinary political events in Quebec and of the closing of the cod fishery in Newfoundland. Unemployment insurance is an especially important and well documented source of income for many people, and regional variation in the generosity of the insurance system over the last three decades has been substantial. The results suggest that while increasing the generosity of the system in high unemployment regions may have induced more migration to the Atlantic region than would otherwise have occurred, the resulting changes in gross flows are probably not large and have had, at most, small effects on average provincial unemployment rates. A variety of other interesting results is also provided.

Suggested Citation

  • Kathleen M. Day & Stanley L. Winer, 2001. "Policy-induced Migration in Canada: An Empirical Study," Carleton Economic Papers 01-08, Carleton University, Department of Economics.
  • Handle: RePEc:car:carecp:01-08
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    1. William G. Watson, 1986. "An Estimate of the Welfare Gain from Fiscal Equalization," Canadian Journal of Economics, Canadian Economics Association, vol. 19(2), pages 298-308, May.
    2. Robin W. Boadway & Frank R. Flatters, 1982. "Efficiency and Equalization Payments in a Federal System of Government: A Synthesis and Extension of Recent Results," Canadian Journal of Economics, Canadian Economics Association, vol. 15(4), pages 613-633, November.
    3. Robin Boadway & Frank Flatters, 1981. "The Role of Equalization Payments in a Federal System of Government, A Synthesis and Extension of Recent Results," Working Papers 443, Queen's University, Department of Economics.
    4. Kathleen M. Day, 1992. "Interprovincial Migration and Local Public Goods," Canadian Journal of Economics, Canadian Economics Association, vol. 25(1), pages 123-144, February.
    5. Winer, Stanley L, 1983. "Some Evidence on the Effect of the Separation of Spending and Taxing Decisions," Journal of Political Economy, University of Chicago Press, vol. 91(1), pages 126-140, February.
    6. Phipps, Shelley, 1990. "Quantity-Constrainted Household Responses to UI Reform," Economic Journal, Royal Economic Society, vol. 100(399), pages 124-140, March.
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    Citations

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    Cited by:

    1. Benoît Tarroux, 2012. "Are equalization payments making Canadians better off? A two-dimensional dominance answer," The Journal of Economic Inequality, Springer;Society for the Study of Economic Inequality, vol. 10(1), pages 19-44, March.
    2. Kari Hämäläinen & Petri Böckerman, 2004. "Regional Labor Market Dynamics, Housing, and Migration," Journal of Regional Science, Wiley Blackwell, vol. 44(3), pages 543-568.
    3. Michael Benarroch & Hugh Grant, 2004. "The interprovincial migration of Canadian physicians: does income matter?," Applied Economics, Taylor & Francis Journals, vol. 36(20), pages 2335-2345.
    4. Grenier, Gilles, 2008. "The internal migration of the immigrant and native-born populations in Canada between 1976 and 1996," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 37(2), pages 736-756, April.
    5. Mark Ferguson & Kamar Ali & M. Rose Olfert & Mark Partridge, 2007. "Voting with Their Feet: Jobs versus Amenities," Growth and Change, Wiley Blackwell, vol. 38(1), pages 77-110.
    6. Giorgio Brosio & Juan Pablo Jiménez, 2012. "The intergovernmental allocation of revenue from natural resources: finding a balance between centripetal and centrifugal pressure," Chapters,in: Decentralization and Reform in Latin America, chapter 10, pages iii-iii Edward Elgar Publishing.

    More about this item

    Keywords

    migration; regional disparity; public policy; unemployment insurance; conditional logit; taxation data;

    JEL classification:

    • H0 - Public Economics - - General
    • H7 - Public Economics - - State and Local Government; Intergovernmental Relations
    • J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts
    • J65 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment Insurance; Severance Pay; Plant Closings
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population
    • R58 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Regional Development Planning and Policy

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