Models of New Zealand Internal Migration and Residential Mobility

Abstract

This dissertation is a study of internal migration and residential mobility in New Zealand, with particular reference to the period 1971-76. It builds on a microeconomic theory of household behaviour in which migration – the permanent relocation across community boundaries - and residential mobility - a permanent move within a locality - are components of a lifetime consumption plan. Models of migration and mobility are tested with data provided by the 1971 and 1976 New Zealand Census of Population and Dwellings. The New Zealand population exhibits strong geographic nobility, with almost every second household making a move over a five year period, although a substantial proportion of all changes of residence takes place over relatively short distances. Mobility increased during 1971-76 as compared with 1966-71, but the contribution of internal migration to urbanization and the northward drift of the population became less pronounced. It is found that mobility is high for the young, declines with age and with prolonged duration of residence. Geographic mobility is also selective of ethnic origin, employment status and occupation but generally not sex-selective. Migration models are estimated with gross inter-Statistical Area (SA) and inter-urban migration data. The inter-SA migration model explains out-migration and its allocation separately, but interdependently, and has a convenient link with the probabilistic Markov chain approach to migration. However, it is less satisfactory in explaining migration in terms of the factors suggested by the microeconomic behavioural framework. Firm evidence for this framework, that interprets migration as both an investment in human capital and an adjustment of location-specific amenities, is provided by a systemic gravity model of inter-urban worker migration. Distance, Cook Strait, the four main urban centres, previous, migration, climate, income, prices and employment opportunities are all important determinants. Cross-sectional differences in residential mobility can be explained in terms of population composition (age, ethnic origin, tenure) and location-specific characteristics (population size, population growth, public transport). In addition, income - or rather a change in income - affects mobility at the micro-level. Completed duration of residence distributions are inferred from uncompleted "years at address" data and these confirm the axiom of cumulative inertia in that the probability of a move declines with duration of stay. Although this dissertation is not directly concerned with the consequences of internal migration, the empirical work suggests that migration enhances a movement towards housing and labour market equilibria rather than away from it. However, while simulation exercises demonstrate a responsiveness of migration to job creation programmes, the low mobility of the young unemployed casts doubt on the effectiveness of a passive "workers to the jobs" policy.