Commuting, Migration and Local Employment Elasticities

Stephen Redding, Esteban Rossi-Hansberg and Ferdinando Monte

No 10933, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: Many changes in the economic environment are local, including policy changes and infrastructure investments. The effect of these changes depends crucially on the ability of factors to move in response. Therefore a key object of interest for policy evaluation and design is the elasticity of local employment to these changes in the economic environment. We develop a quantitative general equilibrium model that incorporates spatial linkages between locations in goods markets (trade) and factor markets (commuting and migration). We find substantial heterogeneity across locations in local employment elasticities. We show that this heterogeneity can be well explained with theoretically motivated measures of commuting flows. Without taking into account this dependence, estimates of the local employment elasticity for one location are not generalizable to other locations. We also find that commuting flows and their importance cannot be accounted for with standard measures of size or wages at the county or commuting zone levels.

Keywords: Local impact; Mobility; Productivity shocks; Ricardian models; Trade (search for similar items in EconPapers)
JEL-codes: F10 J21 J61 R12 R23 (search for similar items in EconPapers)
Date: 2015-11
New Economics Papers: this item is included in nep-mig and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (55)

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Related works:
Journal Article: Commuting, Migration, and Local Employment Elasticities (2018)
Working Paper: Commuting, Migration and Local Employment Elasticities (2017)
Working Paper: Commuting, Migration and Local Employment Elasticities (2015)
Working Paper: Commuting, migration and local employment elasticities (2015)
Working Paper: Commuting, Migration and Local Employment Elasticities (2015)
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