Gravity models of interprovincial migration flows in Canada with hierarchical multifactor structure

Laura Serlenga () and Yongcheol Shin

Empirical Economics, 2021, vol. 60, issue 1, No 15, 365-390

Abstract: Abstract Following recent contributions on migration flows, we contribute to the literature by relaxing restrictions on how multilateral resistance to migration (MRM) may affect province-pair-specific migration flows. We follow recent advancements in the three-dimensional (3D) panel data models with a hierarchical multifactor structure and develop the more flexible specification for MRM. In addition to including unobserved global (country) factors with province-pair-specific coefficients, we can control for local origin (destination)-specific factors that have heterogeneous effects on destinations (origins). We apply the 3DCCE estimator advanced by Kapetanios et al. (J Econom, 2020) to an analysis of the determinants of interprovincial migration flows in Canada from 1976 to 2014. In particular, we find that the recent rise in the internal migration flows, registered in Canada from 2009 onwards, is more likely to be associated with the relative income inequality and network presence rather than the conventional long-run determinants such as income and unemployment differentials.

Keywords: Multilateral resistance to migration cross section dependence; Multi-dimensional panel data models; Unobserved global and local factors; Interprovincial migration (search for similar items in EconPapers)
JEL-codes: C13 C33 F14 F45 (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (6)

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DOI: 10.1007/s00181-020-01938-9

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