Local Ties in Spatial Equilibrium

Mike Zabek

No rpq5z, SocArXiv from Center for Open Science

Abstract: Someone who lives in an economically depressed place was probably born there. And having workers with local ties – who prefer to live in their birthplaces – leads to smaller migration responses in depressed places. Smaller migration responses lead to lower real incomes and make incomes more volatile, a form of hysteresis. Local ties can also persist for generations. Additionally, subsidies to economically depressed places cause smaller distortions, since few people want to move to depressed places. Finally, subsidies to productive places increase aggregate productivity, since they induce more migration.

Date: 2018-08-02
New Economics Papers: this item is included in nep-ure
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Citations: View citations in EconPapers (2)

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Related works:
Journal Article: Local Ties in Spatial Equilibrium (2024)
Working Paper: Local Ties in Spatial Equilibrium (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:osf:socarx:rpq5z

DOI: 10.31219/osf.io/rpq5z

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