Migration Fosters Economic Mobility
The Proof Is In the Numbers
You probably saw the map made by the New York Times’ Upshot blog showing which counties were the best places to grow up. I thought that was a very cool map. The research it was based on, however, is even cooler, as it shows what many migration researchers have believed for a long time: migration is economic development. The very act of migration can have huge (and potentially hugely positive) impacts on future income.
But the “best place to grow up” research got me thinking: do Americans actually migrate to “good” neighborhoods? It’s entirely possible that there are good neighborhoods and bad neighborhoods, but flows from good to bad (so migrations that tend to make kids worse off) neighborhoods outflow flows from bad to good. This is an empirical question, and an important one. If the worse scare-stories about gentrification are correct, then “mobility-hindering” migrations could dominate “mobility-supporting” migration. That would suggest that the observed income gains from migration are being captured by a fairly small sliver of people, while most migrants tend to be worse off.
The great thing about this question is that it’s a fairly simple empirical question. The IRS produces migration data in an easily usable format. This data is essentially the same data the study’s authors use to derive their work in the first place. So we can manipulate it to ask, “Do IRS-tracked migrants tend to move from good to bad, or from bad to good, places?”
Migration and Economic Mobility
Mapping the “Good” Counties
The above map, from the Equality of Opportunity Project, shows “commuter zones” color-coded by their annual impact on childrens’ future incomes at age 26. Dark red means the impact is negative, while yellow or white means a positive impact on income. As you can see, the south and midwest have quite a few red spots.
When we use the Upshot’s more granulated map of county data, with more fine-tuned colors as well, the difference doesn’t seem quite as stark, although, boy, Iowa does look good, and the south still seems to have some real issues.
Migration and Economic Mobility
What Would You Expect?
Now, eyeballing those maps, and based on your prior knowledge of migration, what impact do you think migration will tend to have? Are people moving from places that are bad for their kids’ future incomes to places that are good for their kids’ future incomes?
Well, the Sunbelt looks bad for future incomes, while the Snowbelt and New England look rather better… so, just based on a very simplistic look, we might expect that migration is making intergenerational mobility worse. Uh oh.
Migration and Economic Mobility
Migration Is Mobility
Most migration, however, is short range. Most people don’t move from New York to Florida; they move from the inner city to the suburbs, or from one city to a nearby city, or just over a state line. The popular narratives about migration focus on a farely rare kind of migration: long-range flows. Because most migration is short-range migration, our prior conceptions about national trends will lead us terribly astray!
In turns out, in 2010–11, 4.5 million IRS-defined exemptions (so, let’s say 4.5 million people) moved from “mobility-supporting” counties to “mobility hindering” counties. But 5.2 million people moved the opposite way, from mobility-hindering to mobility-supporting counties. In other words, the balance of migration favored mobility-supporting counties by almost 700,000 people.
But wait! Is that really the whole story? The maps I showed actually refer to impacts on children, and specifically low income children. What does the balance look like for them?
Migration and Economic Mobility
Migration Really, Really Is Mobility
The IRS does not provide detailed data for public use on migration by age or income level, but we can use the data they do provide to make some estimates. If we subtract the number of tax returns from the number of exemptions, we will probably eliminate almost all employed people, who are likely to not be children. This measure would show migration of all “dependents,” which may also be non-working spouses and some others, but will at least be closer to the group the maps really refer to.
For dependents, migration into mobility-supporting counties comes to 2.3 million, versus 2.1 million into mobility-hindering counties. So the relative gap remains pretty similar: dependents seem to be more likely to “upgrade” their neighborhood through migration than to “downgrade” it.
But are the “upgraders” generally rich kids or poor kids? If all we’re seeing is rich kids getting better neighborhoods, that might be bad for mobility.
The data I have on hand doesn’t allow me to restrict my sample to a given income level. But I can identify county-to-county flows with different average income per migrant. While not strictly identical, we should at least be able to see if disproportionately rich- or poor- migration routes tend to be disproportionately mobility-supporting or mobility-hindering.
This calculation requires some juggling. I exclude counties where average income per migrant tax return is less than $7,500, as many of them are in fact negative. These unusual returns reflect mostly business losses, not necessarily “poor” migrants. I then divide my sample into three groups: county-to-county flows where average per-return AGI is $7,500 to $30,000, flows with average AGI $30,000 to $75,000, and flows with average AGI over $75,000.
For the low income category, I find 330,000 “low income” dependents moving from mobility-supporting counties to mobility-hindering counties, compared to 480,000 moving from mobility-hindering to mobility-supporting. That 150,000 person gap is a very large proportion of gross migration. In other words, migration usually has a positive impact on the future income prospects of the typical low-income child.
Migration is Good for Mobility
Migration is a form of economic development. Migration into neighborhoods with lower crime, better schools, more employment opportunities, lower taxes, and other benefits has a direct and causal relationship with higher future income for children. In other words, one way to get out of poverty is to physically relocate out of poverty. That’s obviously harder than it sounds, as migration can be economically and psychologically costly. But the evidence shows that many low-income families succeed in making this type of pro-mobility migration, and such aspirational moves greatly outnumber the low-income families being pushed out of mobility-supporting counties, such as by gentrification.
There is a very important caveat, however. I focused on the simple number of migrants moving each way. But I was surprised to find that the average income gain for each “upgrading” migrant was much smaller than the loss for each “downgrading” migrant. In other words, while the majority of migrants gained through migration, the losing minority took fairly heavy hits to income. I can’t say exactly why this is, but a cursory review of the data suggests that “upgrading” migrants tend to be making incremental shifts into neighboring counties: they are tied to a location by jobs or family, perhaps, and just want a better neighborhood. Downgrading migrants seem to be a bit more likely to move further away, perhaps indicating they experienced unemployment at a higher rate.
See my last post, about regional migration around our continent.
Start the series from the beginning!
If you like this post and want to see more research like it, I’d love for you to share it on Twitter or Facebook. Or, just as valuable for me, you can click the recommend button at the bottom of the page. Thanks!
Follow me on Twitter to keep up with what I’m writing and reading. Follow my Medium Collection at In a State of Migration if you want updates when I write new posts. And if you’re writing about migration too, feel free to submit a post to the collection!
I’m a graduate of the George Washington University’s Elliott School with an MA in International Trade and Investment Policy, and an economist at USDA’s Foreign Agricultural Service. I like to learn about migration, the cotton industry, airplanes, trade policy, space, Africa, and faith.
My posts are not endorsed by and do not in any way represent the opinions of the George Washington University nor the United States government or any branch, department, agency, or division of it. My writing represents exclusively my own opinions. I do not receive any financial support or remuneration from any party for this research.
