A Dynamic Interregional theory of Migration and Population Growth

Mathur, Vijay K.; Stein, Sheldon H.
August 1991
Land Economics;Aug91, Vol. 67 Issue 3, p292
Academic Journal
By treating amenities in an ad hoc fashion without couching them in a theoretical framework, the migration literature ignores the effect of population movements on amenities. Thus, both of these literatures, for the most part, treat amenities as exogenous to their models and ignore the fact that the migration process itself influences some amenities, like traffic congestion and air pollution. The objective in this paper is to bring these two strands of thought together in a cohesive theoretical model. However, while that model did include a labor market, it did not include a housing market and made no attempt to determine the equilibrium level of real full income, which means the sum of earnings and amenity value net of housing price. This is important because it is the disparities in real full income between regions that bring about migration. The migration process continues until the real full incomes are equated. Furthermore, the level of utility cannot change for better or worse in response to any outside shock, including an exogenous amenity shock. The model overcomes these limitations. Second, allow for the possibility that amenity value as well as quantity can change in response to migration.


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