Thesis title: And yet it moves? Insights into income and geographical mobility in Italy
The thesis provides new perspectives on the analysis of mobility in different research contexts. The first two chapters deal with income mobility and its association with income inequality (Chapter 1) and income polarization (Chapter 2), while the third chapter is concerned with geographical mobility in response to labour market shocks (Chapter 3). In all three cases, the focus of the analysis is on the Italian labour market. However, while the first and last works are applied in nature, the second one is a theoretical paper whose application is instrumental to understanding the theory and demonstrating its empirical relevance.
Chapter 1 – "Differences set in stone: evidence on the inequality-mobility trade off in italy" – is designed to give emphasis to the concept of income mobility in the assessment of economic inequality. Using Italy as our case study, we characterise the long-run evolution of intragenerational mobility in the last fifty years and find evidence of a trade-off between income inequality and ’good’ mobility, and complementarity with the worst notions of mobility related to income instability. Exploiting individual-level estimates of good and bad mobility, we also uncover patterns of unequal mobility – the concentration of low upward mobility and frequent fluctuations among the most vulnerable groups.
Chapter 2 – "Inter-temporal income polarization" – proposes an extension of Esteban and Ray (1994) income polarization index to incorporate the time dimension. We introduce time in the model following the idea that the two key ingredients of polarization – alienation and identification – may have fewer implications for potential conflict if individual incomes vary over time and feelings of alienation or identification have therefore limited time to form and consolidate. Accordingly, we proposes an inter-temporal income polarization measure using panel data on incomes in which memory parameters allow past income differences to determine the degree of alienation and identification in a society’s income distribution. The empirical relevance of this longitudinal perspective is demonstrated through an application to Italian data.
Chapter 3 – "Labour market dynamics and geographical reallocation" – deals with a different notion of mobility, namely migration. The work is based on a unique source of administrative data on the universe of labour market flows for Italy and exploits it to study how local labour demand shocks affect internal migration through an instrumental variable approach. Besides providing a comprehensive picture of job and migration flows in Italy in the last decade, the estimates reveal that job creation has a strong effect on the in-migration rate, whereas job destruction has a much milder effect on the out-migration rate, the latter being a less responsive adjustment margin. Crucially, it seems that the large responsiveness of in-migration does not work through an increase in the number of relocating workers, but rather through changes in their destination alternatives. Moreover, the effects of labour market shocks on geographical mobility vary by distance: the positive effect of job creation on in-migration flows has a much larger geographical reach than that of job destruction on out-migration, which instead creates out-migration flows that are locally concentrated.