Determinants of Interregional Migration Flows: the role of environmental factors in the Italian case

This paper investigates the economic and non-economic determinants of interregional migration for unskilled and skilled migrants in Italy for the period 1985-2006, during which different migration trends took place. In so doing, in addition to the traditional variables of the Harris and Todaro model, we consider the impact of house prices and two environmental factors that can have an impact on the quality of migrants’ life (carbon dioxide emission and crime). Using a dynamic two-step panel GMM, we show that the traditional model omits some important variables and may not be representative of migration flow in Italy. Furthermore, our analysis confirms our intuition that for different periods we have to take into account different determinants. Finally for both groups of migrants the externalities are significant, indicating the importance of including broader quality of life consideration as explanatory variables.