Group-specific effects of interregional mobility on earnings - a microdata analysis for Germany

Abstract

The paper analyses the relationship between regional mobility and earnings for different groups of workers. Using a large panel microdata set we find negative earnings differentials of movers in the year before migration and strong evidence for significant wage gains through mobility. A decomposition of Blinder/ Oaxaca type reveals different group-specific rewards effects suggesting a positive post-mobility wage differential of movers over the incumbent workforce for some groups irrespective of the region of destination. The existence of a general wage growth effect of mobility appears to be robust and cannot be explained by the time-invariant part of unobserved heterogeneity.