Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/237360 
Year of Publication: 
2020
Series/Report no.: 
ETLA Working Papers No. 75
Publisher: 
The Research Institute of the Finnish Economy (ETLA), Helsinki
Abstract: 
We examine the economic determinants of interregional mobility. Using plant closures and mass lay-offs for identification, we show that there are obstacles in the labor market that prevent a more efficient reallocation of unemployed individuals and jobs. We find that displacement increases the migration probability by ~80 percent. Displaced workers mostly make migration decisions based on economic (dis)incentives, i.e., higher expected wages and lower expected housing prices outside the origin home location increase the probability of moving after a job loss. In contrast, proximity to family, home ownership and poorly functioning housing markets constitute severe constraints for migration. This outcome is concerning for employment prospects, as, among displaced workers, migration is positively linked to a strong attachment to the labor market.
Subjects: 
Displacement
Internal migration
Housing markets
Expected income
Social capital
Labor market outcomes
JEL: 
J31
J61
J63
Document Type: 
Working Paper

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