Move to more or less productive jobs (M2MLPJ) is concerned with the relocation of economic activity from one region to another. It represents a displacement of economic activity – that is one region gains at another’s expense. This study reviews the theoretical underpinnings to M2MLPJ, and any supporting evidence on the relocation of economic activity. It found that there is both theoretical and empirical support for the concept of the displacing economic activity from one region to another as a consequence of transport investment (i.e. M2MLPJ). However, the evidence is less clear as to which of the micro-mechanisms that underpin M2MLPJ are the most important. The paper also re-examined the value of a re-located job, and the robustness of the parameters used in TAG. The paper concludes that the theory underpinning the M2MLPJ wider impacts in TAG is robust, but that the mechanics of the TAG calculation need adjusting, both to utilise more up to date parameters but also to better reflect the nuances of M2MLPJ. A number of recommendations for the updating of TAG are therefore made.
LAIRD, J.J., A.J. VENABLES and D.H. JOHNSON (2020) Move to More/Less Productive Jobs. Report to the Department for Transport. Report dated: Feb 2020. https://www.gov.uk/government/publications/move-to-more-or-less-productive-jobs-economic-theory