Volume 19, Number 4 (Fall) 1984
Gramlich, Edward M., and Deborah S. Laren. 1984. “Migration and Income Redistribution Responsibilities.” Journal of Human Resources 19(4):489-511.
The importance of migration of AFDC beneficiaries as a determinant of state benefit levels is examined in this paper. A pooled cross-section time-series model fit to state data over the seventies indicates that benefit levels in other states have a positive influence on own-state benefits and a negative influence on recipients. This evidence is supported by that from a transition matrix, which shows that while very few AFDC households make an interstate move in a year, when they do move they are much more likely to go to a high-benefit state than to a low-benefit state. Both pieces of evidence argue for more centralization of income redistribution responsibilities in the United States.
The authors are members of the faculty of the Department of Economics and the Institute of Public Policy Analysis, The University of Michigan. Our work on this topic has been financed by a grant from the Sloan Foundation. We have benefitted from the helpful suggestions of Ted Bergstrom, Robert Frank, Robert Hutchens, Daniel Rubinfeld, Gary Solon, and Hal Varian.
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