Labor market dynamics and the migration behavior of married couples

Between 1964 and 2000, the intercounty migration rate of married couples declined by 15%. Concurrently, female labor force participation and the relative wages of women increased. In 1964, 36% of married households had both spouses in the labor force and women earned only 50% of the wages of men. Over the following 36 years, the fraction of dual earner households increased to 75% and women's earnings rose to 64% of men's. Using a two location household level search model of the labor market, we show that both the increase in dual earner households and the rise in women's wages contributed significantly to the decline in the migration rate of married households, with each explaining 55% and 16% of the decline, respectively. In addition, we show that the co-location problem has important implications for estimates of lifetime earnings inequality. (C) 2020 Elsevier Inc. All rights reserved.