- Economics July 10
This chart from Bank of America Merrill Lynch, via Business Insider's Mamta Badkar, shows that Americans are moving less than they used to:
(Bank of America Merrill Lynch)
That may be bad news for the economy. A dynamic economy requires people being able to move to wherever their most productive niche may be. Often, that can be hundreds or even thousands of miles away. So less geographic mobility tends to mean less economic dynamism. (Although in the era of telecommuting, it is possible that this is beginning to matter less.)
Now, the U.S. still has far more geographic mobility than, for example, Europe. That is helped by the fact that the U.S. has a single common language, unlike Europe. That's one reason why Europe's economy is struggling so much — a lack of a common language means it is much harder for people in a weaker economic area like Greece to move to a more prosperous area, like Germany.
The trend toward less mobility has been driven via the rise of homeownership in the 1990s. Homeowners are less like to move than renters because it is significantly more expensive for homeowners to move, thanks to various costs including broker fees, transaction costs, mortgage fees, insurance, and so on.
Things have gotten worse with the emergence of mortgages with negative equity — in which a borrower owes more on their mortgage than their home is worth — since the 2008 financial crisis. Now that housing prices have bottomed out (they did so in 2012) and are rising again, mobility stands a chance of beginning to rise again.- - John Aziz
THE WEEK'S AUDIOPHILE PODCASTS: LISTEN SMARTER
- 43 TV shows to watch in 2014
- The latent sexism of the male marriage proposal
- Bush vs. Clinton in 2016 is the perfect way to make millennials hate politics even more
- The real story behind Deliver Us From Evil
- How to be the most productive person in your office — and still get home by 5:30 p.m.
- After Ferguson: Stop deferring to the cops
- The hilarious hypocrisy of Republicans complaining about the imperial presidency
- Diagnosing the Home Alone burglars' injuries: A professional weighs in
- This judge is the reason we're still fighting over net neutrality
- Is it now OK to have sex with animals?
Subscribe to the Week