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Regional sorting of human capital: the choice of location among young adults in Sweden
Department of Agricultural and Resource Economics and Policy, University of California, Berkeley, USA.
Umeå University, Faculty of Social Sciences, Umeå School of Business and Economics (USBE), Economics.
Umeå University, Faculty of Social Sciences, Umeå School of Business and Economics (USBE), Economics. Jyväskylä University School of Business and Economics, Jyväskylä, Finland.
2014 (English)Report (Other academic)
Abstract [en]

Migration rates are highest among young adults, especially students, and their location choices affect the regional distribution of human capital, growth and local public sector budgets. Using Swedish register data on young adults, the choice of whether to enroll in education and the choice of location are estimated jointly. The results indicate a systematic selection into investment in further education based on school grades and associated preferences for locations with higher per capita tax bases. For students, the estimates indicate lower preferences for locations with higher shares of older people.  The importance of family networks for the choice of location is confirmed. 

Place, publisher, year, edition, pages
Umeå: Umeå universitet , 2014. , 26 p.
Series
Umeå economic studies, ISSN 0348-1018 ; 878
Keyword [en]
Agglomeration, human capital, local public sector, location choice
National Category
Economics
Research subject
Economics
Identifiers
URN: urn:nbn:se:umu:diva-86660OAI: oai:DiVA.org:umu-86660DiVA: diva2:700178
Available from: 2014-03-03 Created: 2014-03-03 Last updated: 2014-10-29Bibliographically approved
In thesis
1. Migration and Regional Sorting of Skills
Open this publication in new window or tab >>Migration and Regional Sorting of Skills
2014 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

This thesis consists of an introductory part and four papers.

Paper [I] estimates jointly the choice of whether to enroll in education and the choice of location among young people. Being a particularly mobile group, the location choices of young individuals shape much of the regional distribution of human capital, growth, and local public sector budgets. Applying Swedish register data on nest leavers, we seek to determine factors deciding the education and location choice of young people. The results indicate a systematic selection higher education based on school grades and preferences for locations with higher per capita tax bases and with lower shares of elderly people. The importance of family networks for the choice of location is confirmed.             

Paper [II] examines how individual ability, reflected by the grade point average (GPA) from comprehensive school affects the probability of migration among university graduates. The econometric analysis applies detailed micro-data of two entire cohorts of young individuals retrieved from the Swedish population registers. The results indicate that individual abilities are strongly influential both concerning completion of a university degree and for the migration decision. In addition, we find a positive relationship between the GPA and migrating from regions with lower per capita tax bases and/or a relatively small share of highly educated individuals. Analogously, individuals with a high GPA tend to stay in more densely populated regions, suggesting a clustering of human capital vis-à-vis school grades. 

Paper [III] estimates the relationship between migration across labour market regions and the subsequent changes in earnings by using the GPA from the final year of comprehensive school as a proxy for ability. This measure aims to capture heterogeneity in the returns to migration for individuals conditional on education attainment. Using Swedish register data on young adults, a difference-in-difference propensity score matching estimator is applied to estimate income differences measured up to seven years after migration. The results show variation between different ability groups regarding the returns to regional migration. There are indications of larger gains for individuals holding top grades, while the bottom half seems to benefit less, or face slightly negative effects.

Paper [IV] examines whether power couple formation and the location choice of such couples are driven by factors already inherent in young people during their formative school years. The paper also extends the analysis by modeling location choice among different sizes of labor market areas, given different power statuses of the couples. Based on analysis of Swedish register data, we produce evidence that power spouses evolve from the population of high achieving school age individuals; the latter is identified by high academic performance during their years of compulsory school. Regarding location choice, the results indicate that power couples display a relatively high tendency to migrate from their regions of origin to large cities.

Place, publisher, year, edition, pages
Umeå: Umeå Universitet, 2014. 46 p.
Series
Umeå economic studies, ISSN 0348-1018 ; 882
Keyword
Agglomeration, early markers, human capital, income, interregional migration, individual ability, location choice, marital matching, propensity score matching, regional clustering, skills, university graduates
National Category
Economics
Identifiers
urn:nbn:se:umu:diva-86674 (URN)978-91-7601-012-9 (ISBN)
Public defence
2014-03-28, Humanisthuset, Hörsal E, Umeå universitet, Umeå, 13:15 (English)
Opponent
Supervisors
Available from: 2014-03-07 Created: 2014-03-04 Last updated: 2014-03-05Bibliographically approved

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Tano, SofiaWesterlund, Olle

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