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The Effect of Homeownership on the Option Value of Regional Migration

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  • Florian Oswald

    (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique)

Abstract

This paper estimates a lifecycle model of consumption, housing choice, and migration in the presence of aggregate and regional shocks, using the Survey of Income and Program Participation (SIPP). The model delivers structural estimates of moving costs by ownership status, age, and family size that complement the previous literature. Using the model, I first show that migration elasticities vary substantially between renters and owners, and I estimate the consumption value of having the option to migrate across regions when there are regional shocks. This value is 19 % of lifetime consumption on average, and it varies substantially with household type.

Suggested Citation

  • Florian Oswald, 2019. "The Effect of Homeownership on the Option Value of Regional Migration," SciencePo Working papers Main hal-03799479, HAL.
    • Handle: RePEc:hal:spmain:hal-03799479
    DOI: 10.3982/QE872
    Note: View the original document on HAL open archive server: https://hal-sciencespo.archives-ouvertes.fr/hal-03799479
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    References listed on IDEAS

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    1. David Card, 2012. "Comment: The Elusive Search For Negative Wage Impacts Of Immigration," Journal of the European Economic Association, European Economic Association, vol. 10(1), pages 211-215, February.
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    Cited by:

    1. Mikhail Golosov & Michael Graber & Magne Mogstad & David Novgorodsky, 2021. "How Americans Respond to Idiosyncratic and Exogenous Changes in Household Wealth and Unearned Income," NBER Working Papers 29000, National Bureau of Economic Research, Inc.

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