Population Aging, Migration Spillovers, and the Decline in Interstate Migration

Interstate migration in the United States has declined by 50 percent since the mid-1980s. This paper studies the role of the aging population in this long-run decline. We argue that demographic changes trigger a general equilibrium effect in the labor market, which affects the migration rate of all workers. We document that an increase in the share of middle-aged workers (those ages 40 to 60) in the working-age population in one state causes a large fall in the migration rate of all workers in that state, regardless of their age. To understand this finding, we develop an equilibrium search model of many locations populated by workers whose moving costs differ. Firms prefer hiring local workers with high moving costs as they command lower wages due to their lower outside option. An increase in the share of middle-aged workers causes firms to recruit more from the local labor market instead of hiring from other locations, which increases the local job-finding rate and reduces everyon's migration rate ("migration spillovers"). Our model reproduces remarkably well several cross-sectional facts between population flows and the age structure of the labor force. Our quantitative analysis suggests that population aging accounts for about half of the observed decline, of which 75 percent is attributable to the general equilibrium effect

Data for: Human capital accumulation in a federation

Abstract of associated article: More than half of the variation across U.S. school districts in real K-12 education expenditures per student is due to differences between, rather than within, states. I study the welfare implications of redistribution of education expenditures by the Federal government, using an analytically tractable model of human capital accumulation with heterogeneous agents and endogenous state policies. The net welfare effect of Federal redistribution depends on a trade-off between the positive effect of redistributing resources toward poorer states and the negative effect resulting from misallocation of population across states. Federal redistribution increases welfare in a calibrated version of the model

Make yourselves scarce: The effect of demographic change on the relative wages and employment rates of experienced workers

This paper studies the impact of demographic change on experienced workers’ relative wages and employment rates. We investigate empirical predictions from aframework of supply and demand for experience skill, using variation across U.S. local labor markets (LLMs) over the last decades and instrumenting experienceskill supply by the LLMs’ age structures a decade earlier. We find that aging substantially reduces experienced workers’ relative wages and full-time employmentrates, and also their labor market participation rates. Our results imply that the effect of demographic change on labor markets might be more severe than previously recognized, as it reaches beyond wages

Can immigrants help women “have it all”? Immigrant labor and women’s joint fertility and labor supply decisions

This paper explores how inflows of low-skilled immigrants impact the tradeoffs women face when making joint fertility and labor supply decisions. I find increases in fertility and decreases in labor force participation rates among high skilled US-born women in cities that have experienced larger immigrant inflows. Most interestingly, these changes have been accompanied by decreases in the strength of the negative correlation between childbearing and labor force participation, an often-used measure of the difficulty with which women combine motherhood and labor market work. Using a structured statistical model, I show that the immigrant-induced attenuation of this negative correlation can explain about 24 percent of the immigrant-induced increases in the joint likelihood of childbearing and labor force participation in the U.S. between the years 1980 and 2000