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Economic Freedom and Migration Flows between U.S. States
Author(s) -
Ashby Nathan J.
Publication year - 2007
Publication title -
southern economic journal
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.762
H-Index - 58
eISSN - 2325-8012
pISSN - 0038-4038
DOI - 10.1002/j.2325-8012.2007.tb00796.x
Subject(s) - economic freedom , economics , index of economic freedom , census , order (exchange) , consumption (sociology) , government (linguistics) , index (typography) , demographic economics , degrees of freedom (physics and chemistry) , labour economics , sociology , population , social science , linguistics , philosophy , demography , finance , world wide web , computer science , market economy , physics , quantum mechanics
A modified gravity model is estimated using a cross section of data drawn from the U.S. Census Bureau survey of 2000 in order to analyze the impact of economic freedom on gross migration flows among the lower 48 states. Spatial econometric methods are utilized in order to capture spatial effects not detected by distance. In addition, the Economic Freedom of North America Index is decomposed to determine the individual impact of various policies. Results show that states with higher relative economic freedom experience greater migration inflow through its direct impact on income and employment growth. In aggregate, the findings indicate that individuals migrate toward states with relatively higher government consumption expenditures, relatively lower tax burdens, and states with more freedom with respect to labor decisions in the form of less restrictive minimum wages, less concentration of unions, and less dependence on public employment.