New Report: When Moving Matters: Residential and Economic Mobility Trends in America, 1880–2010

In recent years, observers across America’s political spectrum have expressed concern over declining residential mobility and its implications for economic mobility in the United States. There is a widespread belief that Americans’ economic mobility has declined and that Americans are also less likely to “move to opportunity” than in the past. These two assertions have been linked to argue that falling residential mobility is an important factor behind diminished economic opportunity in America.

The reality is more complicated. The bulk of research on economic mobility—focused on earnings, income, occupation, and education—suggests very little change since at least the mid-twentieth century. While the share of Americans having moved in the previous year has fallen since the 1970s, other types of residential mobility are now as high as they have been in 100 years or more.

An extensive analysis of different data sources—12 decennial censuses, extending back to the nineteenth century; the Census Bureau’s American Community Survey; and two panels from the Labor Department’s National Longitudinal Surveys—confirms a long-standing connection between residential mobility and economic outcomes. This connection is much stronger when focusing on the kinds of residential mobility that have not declined, such as moves between birth and adulthood (and most likely between adolescence and adulthood) and moves across state boundaries.

People who are willing and able to relocate may be more likely to earn more money. Moving to better opportunities has been a prominent feature of American history. Westward expansion, for example, was one of the most important developments of the nineteenth century. During the first half of the twentieth century, millions of African-Americans moved from the South to seek better lives in northern cities. During the 1930s, hundreds of thousands of farmers left the Dust Bowl.

Another form of geographic mobility that has been historically important for expanding opportunity involves moves within metropolitan areas, especially from city to suburb. Postwar housing and transportation policy, combined with explosive growth in automobile ownership and pent-up demand for more living space, caused a dramatic decentralization of people and jobs within metro areas. Those who were unable or unwilling to move from the city found themselves facing an eroding tax base, a rising share of lower-skilled and disadvantaged residents, higher crime, and slower job growth.

Even within cities, the willingness and ability to move has been thought to be of consequence for economic mobility. Concentrated poverty, particularly severe among African-Americans, has long been considered disadvantageous, and federal housing subsidies have shifted in recent decades away from dense high-rise projects within poor neighborhoods to rental vouchers and dispersed low-rise and mixed-income projects. The evidence for so-called neighborhood effects on child and adult outcomes has been mixed, but recent papers by Harvard economist Raj Chetty and his colleagues have compellingly reinforced that place really does matter.

While the trajectories of U.S. residential and economic mobility are thus less alarming than widely believed, there is still good reason to be concerned. Though not lower than in the past, U.S. upward economic mobility remains low, and certain disadvantaged groups, including the less-educated and African-Americans, are less willing, or able, to move to economic opportunity.

If the association between residential and economic mobility reflects a causal relationship—as recent research suggests—opportunity in America could be expanded through policies to promote greater residential mobility among groups with low upward economic mobility. Various policies to reform the country’s safety net, reduce housing-cost inflation, and deregulate housing and labor markets might effectively encourage migration to higher-opportunity areas.

To read the full report, click here. 

Scott Winship is the Walter B. Wriston Fellow at the Manhattan Institute for Policy Research. You can follow him on Twitter here.

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