Keywords

Relative Deprivation, Inequality, Internal Migration

JEL D31, R23

Key Questions

• Which factors do influence the emigration from Austrian municipalities to other municipalities within Austria?

• Do the relative income (average relative deprivation) and thus the comparison with other individuals in the same municipalities constitute an essential determinant for internal migration across Austrian municipalities?

• Does the average relative deprivation (income inequality) reveal a higher or a lower impact in more urban regions in Austria?

• Which social groups are more sensitive to a higher average relative deprivation (income inequality) and for which groups is it irrelevant with respect to internal migration?

Key Findings

• Emigration rates of Austrian municipalities are influenced, inter alia, by population size, household structure, demographic and educational structure (within the municipality), the absolute income level as well as the relative income (average relative deprivation).

• The average relative deprivation (income inequality) represents a robust push-factor for the outflows of Austrian municipalities to other municipalities within Austria.

• The average relative deprivation (income inequality) reveals a higher effect in urban Austrian regions.

• The effect of the average relative deprivation is stronger among those with comparably low levels of income, and among low skilled and young individuals.

• The outflows of higher income groups as well as higher skilled groups are insensitive to income inequality.

Abstract

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 ind 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.