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The laws of attraction: Economic drivers of inter-regional migration, housing costs and the role of policies

Author

Listed:
  • Orsetta Causa
  • Michael Abendschein
  • Maria Chiara Cavalleri

Abstract

This paper sheds light on inter-regional migration, housing and the role of policies, drawing on a new comparative cross-country approach. The results show that OECD countries exhibit stark variation in both levels and trends in inter-regional migration, which is found to be highly responsive to local housing and economic conditions. In turn, a large number of policies in the area of housing, labour markets, social protection and product markets influence the responsiveness of inter-regional migration to local economic conditions. For instance, more flexible housing supply makes inter-regional migration more responsive to local economic conditions while higher regulatory barriers to business start-ups and entry in professions significantly reduce the responsiveness of inter-regional mobility to local economic conditions. The capacity of workers to move regions in response to local economic shocks is one key dimension of labour market dynamism which could, at the current juncture, contribute to the recovery from the COVID-19 crisis. In this context, the paper proposes articulating structural with place-based policies to help prospective movers as well as stayers.

Suggested Citation

  • Orsetta Causa & Michael Abendschein & Maria Chiara Cavalleri, 2021. "The laws of attraction: Economic drivers of inter-regional migration, housing costs and the role of policies," OECD Economics Department Working Papers 1679, OECD Publishing.
    • Handle: RePEc:oec:ecoaaa:1679-en
    DOI: 10.1787/da8e368a-en
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    Cited by:

    1. Filippo Maria D’Arcangelo & Ilai Levin & Alessia Pagani & Mauro Pisu & Åsa Johansson, 2022. "A framework to decarbonise the economy," OECD Economic Policy Papers 31, OECD Publishing.

    More about this item

    Keywords

    housing markets; Internal migration; labour markets; place-based policies; regional disparities; regional economic conditions; regional house prices; regional mobility; social protection; structural policies;
    All these keywords.

    JEL classification:

    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R50 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - General
    • R58 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Regional Development Planning and Policy
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General

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