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Risk attitudes and migration decisions
Author(s) -
Roca Paz Roberto,
Uebelmesser Silke
Publication year - 2021
Publication title -
journal of regional science
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.171
H-Index - 79
eISSN - 1467-9787
pISSN - 0022-4146
DOI - 10.1111/jors.12530
Subject(s) - bivariate analysis , multivariate probit model , metropolitan area , causality (physics) , econometrics , probit model , ordered probit , panel study of income dynamics , probit , economics , fragility , state (computer science) , demographic economics , geography , computer science , mathematics , statistics , physics , chemistry , archaeology , algorithm , quantum mechanics
This paper analyzes the relationship between individuals' attitudes towards risk and their decision to migrate. We consider migration in the United States across metropolitan statistical areas (MSAs) between 1997 and 2015, based on data from the Panel Study of Income Dynamics (PSID). Using random‐effects specifications, we find that being relatively more willing to take risks is positively and significantly related to cross‐MSA migration. For cross‐state migration and migration across larger distances, risk attitudes are slightly more important. A recursive bivariate probit model of simultaneous equations addresses the potential endogenous nature of attitudes towards risk and allows ruling out reverse causality.