Do people move to places that are better for business or better for fun?

Jul 23, 2019

A new study from Motu Economic and Public Policy Research for the Building Better Homes, Towns, and Cities National Science Challenge uses a deep-dive analysis of census rent and wage data to look at whether people choose to move to locations with better quality of life or better quality of business.

Migrants are defined as ‘domestic’ if they lived in New Zealand five years ago and ‘international’ if they were not living in New Zealand. The international category therefore includes migrants who were new to New Zealand and New Zealanders returning home after living overseas.

Locations with a high quality of life attract migrants from other urban areas, but do not attract international migrants. Locations with a high quality of business do not attract domestic (urban or rural) migrants, but do attract international migrants.

“A one standard deviation increase in a location’s quality of business is estimated to increase international migration into that location by approximately one-third, while raising domestic residents’ migration out of that location by approximately one-fifth,” said Dr Grimes.

The attractiveness of quality of business holds even when we control for the way that international migrants move to big ‘gateway’ cities on first arrival.

People aged between 30 and 59 who’ve lived in New Zealand for five years tend to leave big cities where there is high quality of life and/or high quality of business and go to smaller places with even higher quality of life.

“From a local government perspective, when city officials are deciding between a port that helps business or a concert hall, they are implicitly choosing the type of migrant that they attract as well as the type of city that may result,” said Dr Grimes.

Summary haiku
International
and local urban migrants
differ in their tastes.

Building Better Homes, Towns and Cities
Building Better Homes, Towns and Cities (BBHTC) is one of 11 National Science Challenges, funded by the Ministry of Business, Innovation and Enterprise (MBIE). BBHTC undertakes world-class research to shape New Zealand’s built environment and strengthen communities. The Challenge develops findings that will empower public, planners and policymakers with reliable information and new tools for fresh thinking and better decisions. The Challenge is discovering new pathways to address the long-standing housing challenges of our most disadvantaged and to support Māori into healthy homes.