Between the 1970s and 2010, the rate of Americans moving between states fell by more than half—from 3.5 percent per year to 1.4 percent. “It’s a puzzle and it’s the one I wish politicians and policy makers were more concerned about,” Betsey Stevenson, a former member of Obama’s Council of Economic Advisers, told The New York Times this week. Fewer Americans moving toward the best jobs and starting fewer companies could lead a less productive economy. On Thursday, the Financial Times reported that productivity “is set to fall in the U.S. for the first time in more than three decades.”…
Every dimension of declining American dynamism is connected. The slowdown in most areas’ business development comes from a shifting tide in American migration. For 100 years, population flowed from poor areas to rich areas. Now the trend has reversed. Land-use policies prevent more middle-class families from living in productive areas, because housing becomes too expensive. Meanwhile, the rich can afford to cluster in a handful of metros where entrepreneurship is a norm, while business dynamism falls in the rest of the country. There used to be too much land to settle. Now there’s not enough land to share.
Two quick related thoughts:
- You regularly see people make the argument that people should just pick up and move to where there are more opportunities, meaning jobs and a cheaper cost of living (generally referring to housing and maybe taxes). There is even a single case in Evicted where a person moves from a poor Milwaukee neighborhood to a southern city and seems to be doing well. However, moving is not necessarily easy (see #2).
- Why are economists the only ones summarized here? Are sociologists not paying much attention to this? On one hand, I can see how economics would drive decisions about moving. Yet, it is not the only factor. People have social connections wherever they live and it can be difficult to form new social networks. While Americans always have prized mobility, don’t they also celebrate finding your roots and being a presence in your community? (Granted, Americans may be doing neither: moving less and being less engaged in civic life.) This reminds me of some public housing residents who didn’t want to leave pretty bad conditions in high-rise buildings. Or, what about explanations like those in The Big Sort or The Rise of the Creative Class where people choose to live near people like themselves.