Why are educated and risk-loving persons more mobile across regions?

Abstract

Why Are Educated and Risk-Loving PersonsMore Mobile Across Regions? * Why are better educated and more risk-friendly persons more mobile across regions? To answer this question, we use micro data on internal migrants from the German SocioEconomic Panel (SOEP) 2000-2006 and merge this information with a unique proxy for region-pair-specific cultural distances across German regions constructed from historical local dialect patterns. Our findings indicate that risk-loving and skilled people are more mobile over longer distances because they are more willing to cross cultural boundaries and move to regions that are culturally different from their homes. Other types of distance-related migration costs cannot explain the lower distance sensitivity of educated and risk-loving individuals.JEL Classification: J61, R23, D81

Prospect theory and the decision to move or stay

“…Previous tests document the relationship of risk and migration. Among skilled people, those who are less risk averse are more willing to migrate to culturally different regions in Germany (31). Research on expatriate networks and international migration timing suggests that as the size of expatriate networks increases over time, finding employment after migration becomes less uncertain, inducing more risk-averse individuals to migrate (32).…”

Loss aversion and duration of residence

“…While issues of risk and mobility are receiving growing attention in the mobility literature (e.g., Bauernschulster et al 2014), almost all empirical studies which attempt to incorporate risk do so using proxies, as captured in responses to questions on hypothetical actions or responses to hypothetical investment decisions. While they may (or may) not be transferable measures either across realms or over time, these proxies have no observable reference point.…”

Fertility intention‐induced relocation: The mediating role of housing markets

“…In their study on the relationship between fertility intention and residential mobility, Ermisch and Steele (2016) found that women's educational qualification has no significant effect on residential mobility in the mobility model and included the variable in the fertility intention model as one of the excluded covariates. Women's education is more relevant in long-distance moves (e.g., job-related moves) than shortdistance moves (e.g., fertility-related moves; Bauernschuster, Falck, Heblich, Suedekum, & Lameli, 2014;Clark, 2013;Van Ommeren, Rietveld, & Nijkamp, 1997). Moreover, some studies suggest that women's education may be irrelevant to mobility when other variables that are highly correlated with education are included (Quigley & Weinberg, 1977) or when husbands' contribution to family income is large (Lichter, 1982).…”