Friday, April 24, 2009

Mobility and The Frontier Spirit

In an earlier post I wrote that this recession is different from others in part because few regions have escaped the problems in the housing and credit markets. In the past people could move to a different city or state to find work. This would reallocate labor to regions that could productively utilize new workers (see here and here for more). Now with most areas of the country reeling, this is less of an option. This is reflected in the mobility data the Census Bureau just released. From the NYT:

The bureau found that the number of people who changed residences declined to 35.2 million from March 2007 to March 2008, the lowest number since 1962, when the nation had 120 million fewer people.

Experts said the lack of mobility was of concern on two fronts. It suggests that Americans were unable or unwilling to follow any job opportunities that may have existed around the country, as they have in the past. And the lack of movement itself, they said, could have an impact on the economy, reducing the economic activity generated by moves.
Also see Mark Thoma's post from March, which highlights some research by Chris Nekarda, a recent PhD grad from UCSD, on the cyclicality of mobility. In short, the post argues that more people move when times are bad, not when they are good, relative to trend. While the implications for our current downturn are important, it is perhaps a more useful exercise to think about the recent structural shifts in our economy that are driving these trends and what they mean for our future.

Looking ahead, what effect with the current crisis have on America's much lauded "Frontier Spirit?" I use this term because our good friend David Miller is doing research on Frederick Jackson Turner's thesis about the Frontier Spirit. In a fairly recent post David wonders whether our current troubles could mark the closing of the frontier. Thoughts?

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