Determinants of Interregional Labor Mobility in Russia

The paper studies the determinants of internal migration in Russia. Using panel data on gross region to-region migration flows in 1992–99, we estimate the effect of economic, political and social factors. Although overall migration is rather low, it turns out that its intensity does depend on economic factors even controlling for fixed effects for each origin–destination pair. People move from poorer and job scarce regions with worse public good provision to those which are richer and prospering better both in terms of employment prospects and public goods. Migration is, however, constrained by the lack of liquidity; for the poorest regions, an increase in income raises rather than decreases outmigration. Our estimates imply up to a third of Russian regions are locked in poverty traps.