Migration Constraints and Disparate Responses to Changing Job Opportunities

Abstract

Using the Current Population Survey between 1996 and 2018, this paper investigates the role constraints to migration might play in explaining racial/ethnic disparities in the labor market. The Delta Index of dissimilarity is used to illustrate a greater distributional mismatch between race/education specific workers and jobs among minorities relative to white non-Hispanics. Regression analysis then shows that this mismatch is consistent with minorities being less responsive to changes in the distribution of job opportunities. However, minorities are more responsive when the growing job opportunities are located in areas with greater same-racial/ethnic representation, suggesting that social constraints might play a role in the observed distributional mismatch. The analysis focuses on 25-54 year old men.

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“…Q1, Q2, Q3, and Q4 correspond to households in the first, second, third, and fourth income quartiles. Source: Burns and Hotchkiss (2023) As others have also documented, figure 2 shows that the gasoline tax is highly regressive. Because gasoline purchases make up a greater share of total expenditures at the lower end of income distribution, any increases in the gas tax also increase the loss of consumer surplus by a greater amount, relative to losses in the upper end of the distribution.…”

“…Using results from Burns and Hotchkiss (2023), who estimate a model of household expenditures, we illustrate the distributional implications of increasing the gasoline tax. We simulate the introduction of electric vehicles into the consumer's expenditure set by assuming declines in gasoline expenditures, with relative declines increasing as family income increases.…”

“…Note: Loss in consumer surplus is calculated using uncompensated elasticities of demand for gasoline estimated by Burns and Hotchkiss (2023). Current gasoline consumption corresponds to reported gasoline consumption by families between 2016 and 2018 in the Current Expenditure Survey.…”

“…Note: Increased PEV adoption is simulated by decreasing household gasoline consumption to 1 percent of previous consumption for 2 percent, 5 percent, 10 percent, and 20 percent of households (selected at random from the sample) in the first, second, third, and fourth quartiles, respectively. Source: Burns and Hotchkiss (2023)…”