Jestl, Stefan and Moser, Mathias and Raggl, Anna K.
Can't Keep Up with the Joneses: How Relative Deprivation
Pushes Internal Migration in Austria.
INEQ Working Paper Series, 5.
WU Vienna University of Economics and Business, Vienna.
We estimate the effect of regional income inequality on emigration rates of Austrian
municipalities using a unique data set that is constructed We estimate the effect of regional income inequality on emigration rates of Austrian
municipalities using a unique data set that is constructed based on individual level data
from Austrian administrative registers. The register-based data contains information on the
municipality of residence of all individuals aged 16 and over that have their main residency
in Austria, as well as their income and socio-demographic characteristics. Aggregating this
information to the municipality level allows us to assess the role of relative deprivation -
a measure of relative income - on top of absolute income in shaping internal migration in
Austria. We find that increases in relative deprivation in a municipality lead to higher emigration from the municipality. Allowing for heterogeneous effects across income, education,
and age groups reveals that the effect is stronger among those with comparably low levels
of income, and among low skilled and young individuals.