Template-Type: ReDIF-Paper 1.0
Author-Name: Arthur Grimes
Author-X-Name-First: Arthur
Author-X-Name-Last: Grimes
Author-Email: arthur.grimes@motu.org.nz
Author-Workplace-Name: Motu Economic and Public Policy Research
Author-Name: Judd Ormsby
Author-X-Name-First: Judd
Author-X-Name-Last: Ormsby
Author-Email: judd.ormsby@gmail.com
Author-Workplace-Name: Motu Economic and Public Policy Research
Author-Name: Kate Preston
Author-X-Name-First: Kate
Author-X-Name-Last: Preston
Author-Email: kate.preston@motu.org.nz
Author-Workplace-Name: Motu Economic and Public Policy Research
Title: Wages, Wellbeing and Location: Slaving Away in Sydney or Cruising on the Gold Coast 
Abstract: We analyse the relationships between subjective wellbeing (SWB), wages and internal migration. Our study addresses whether people make (revealed preference) location decisions based on SWB and/or wage prospects. We present both a theoretical intertemporal location choice model and empirical analyses using the Australian longitudinal HILDA dataset. Our theory predicts considerable heterogeneity in location choices for individuals at different life stages depending on their individual characteristics, including their rate of time preference. We find a significant and sustained uplift in SWB for migrants, which holds across a range of sub-samples. By contrast, wage responses are muted albeit with heterogeneity across groups. Our theory and results show that migration decisions are considered within a life-cycle context. The estimated pronounced upturn in SWB for migrants substantiates the usefulness of SWB both as a concept for policy-makers to target and for researchers to incorporate in their studies.
Length: 84 pages
Creation-Date: 2017-04
File-URL: https://motu-www.motu.org.nz/wpapers/17_07.pdf
Number: 17_07
Classification-JEL: D91, H75, I31, R23
Keywords: Regional migration, wages, subjective wellbeing, non-pecuniary amenities.
Handle: RePEc:mtu:wpaper:17_07