Are Immigrants More Mobile Than Natives? Evidence From Germany

Low rates of internal migration in many European countries contribute to the persistence of signi…cant regional labor market di¤erences. I use the Mikrozensus, a large annual sample of households living in Germany, to further our understanding of the underlying reasons. This paper makes two main contributions: …rst, the paper quanti…es the disutility of migrating. To this end, I estimate conditional logit models of the migration decision across the German federal states. Secondly, I then focus on the di¤erences between immigrants and natives. I …nd signi…cantly higher responsiveness to labor market di¤erentials in the immigrant population than in the native population. Unobserved moving costs for immigrants are estimated to be only about 31% of this same cost for natives. The …ndings bear on the assessment of the economic impact of immigration, and the paper contributes to the current immigration-related policy debates that feature prominently in many European countries, and that likely will continue to be important in light of the ongoing EU expansion and the resulting east-west migration. I would like to thank Joseph Altonji, Nicola Fuchs-Schündeln, Jenny Hunt, Paul Schultz, and Christopher Timmins for helpful comments, the Institute for the Study of Labor (IZA), Bonn, for hospitality, and the Statistische Bundesamt for giving me access to the data. Address: Goethe University Frankfurt, Grüneburgplatz 1, 60323 Frankfurt am Main, Germany. Email: [email protected].