Migration and Income Redistribution Responsibilities

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.