O Brother, Where Art Thou? The Effects of Having a Sibling on Geographic Mobility and Labour Market Outcomes

Abstract

This paper formulates a model to explain how parental care responsibilities and family structure interact in affecting children's mobility characteristics. Our main result is that the mobility of young adults crucially depends on the presence of a sibling. Siblings compete in location and employment decisions to direct parental care decisions towards their preferred outcome. Only children are not exposed to this kind of competition. This causes an equilibrium in which siblings exhibit higher mobility than only children, and also have better labour market outcomes. Using data from the German Socio‐Economic Panel, we find evidence that confirms these patterns.