Retailers Are in on Shrinkflation
It’s not just manufacturers who are responsible for this long-running, widespread phenomenon.
Retailers Are in on ShrinkflationIn 1935 Caroline Henderson, a wheat, barley, and cattle farmer on 640 acres of the Oklahoma Panhandle, wrote to a friend in Maryland about her family’s decision to stay put even as dust storms swept the region for a fourth year, coating fields in silt that, alongside erosion and drought, destroyed any hope for crops. “I scarcely need to tell you that there is no use in thinking of either renting or selling farm property here at present,” Henderson wrote. “We could realize nothing whatever from all our years of struggle with which to make a fresh start.”
Others in the region felt differently, producing one of US history’s biggest migrations. Henderson was one of many chroniclers of the Dust Bowl and its impact on migration, joined by John Steinbeck, whose novel The Grapes of Wrath won the Pulitzer Prize, and Dorothea Lange, whose iconic 1936 photograph of a migrant mother and her children is part of the Museum of Modern Art’s collection.
These accounts feel resonant today, as global warming makes the world’s population freshly aware that anyone could at some point be confronted with the need to uproot.
More than 200 million people globally live in coastal regions at risk of flooding as temperatures rise, according to The Stern Review: The Economics of Climate Change, a comprehensive report produced for the UK government in 2006. More recent studies suggest this is an underestimate: one 2019 paper says up to 340 million people could be threatened by flooding by 2050.
A 2021 report by the World Bank, employing advanced modeling, predicts that climate change could force 216 million people in Africa, Latin America, Eastern Europe, and East, South, and Central Asia to move by 2050. And in the United States, environmental economists Qin Fan of California State University, Fresno; Karen Fisher-Vanden of Penn State; and H. Allen Klaiber of Ohio State estimate that extreme temperatures (both hot and cold) will likely push millions of US residents in the South and Midwest out of those regions over the next 40 years—even taking into account possible countervailing forces such as changes in home prices and wage rates in response to climate-induced migration.
Migrations affect more than the people forced to move, and the relocation of hundreds of millions of people has the potential to transform societies and economies worldwide, many of which are likely to struggle, politically and economically, with the implications. Will infrastructure be adequate? Who will provide and pay for social services? What will people need to settle and be productive in new areas?
These are all open questions worrying policy makers. “If you think migration has been a problem in Europe from the Syrian War, or even from what we see now, wait until you see a hundred million people for whom the entire food-production capacity has collapsed,” said John Kerry, the US’s climate envoy, at an energy conference in March 2022.
To be able to plan for and manage what could be the largest migration in human history, it would be valuable to have some foundational facts about these climate migrants. At a basic level, who migrates in response to climate collapse? Are they similar to other migrants, including those fleeing war or poverty, or do they differ in important ways? History may hold some answers, and Chicago Booth’s Richard Hornbeck is finding some of them in data from the Dust Bowl era.
Research stretching back to the 1950s has produced an abundance of information about both migration within and between countries. But little of it pertains to people who have moved because of permanent, climate-induced change, and even studies that do focus in on this group can struggle to distinguish climate migrants from migrants driven or pulled by other forces.
People move for all sorts of reasons, making migration difficult to generalize. As China’s Central University of Finance and Economics’ Ning Jia and the US Federal Reserve’s Raven Molloy, Christopher Smith, and Abigail Wozniak point out, active migration research includes two important areas: that which looks at patterns in who, exactly, is moving around, and that which tries to measure migrants’ impact on the places to which they move—and what their departure means for the places they leave behind.
Some patterns have emerged in both of these categories. People who move from one US location to another, for example, tend to be better educated than the people who stay put, according to multiple studies over seven decades.
It could be that high-skilled, educated workers are moving for better opportunities. This notion, that higher-earning or more-productive individuals self-select into crossing national borders, was widely accepted in the 1960s and ’70s. But it was undermined in the late 1980s with new methodologies by researchers including George J. Borjas, now at Harvard, who observed in a 1991 paper that country of origin was pivotal in determining whether an immigrant to the US had been more or less productive than a nonimmigrating peer.
Those from developed countries tended to be relatively more productive, and those from developing countries relatively less productive. However, in terms of education, immigrants from developing and developed countries alike were ahead of their average compatriots: Borjas found that immigrants to the US, regardless of where they were arriving from, had significantly more years of education, on average, than their peers at home.
Credit: United States Department of Agriculture (left); Shutterstock (right)
Decades of research has collected such observations about migration generally, giving us an increasingly detailed picture about the people who move. But extrapolating these facts to climate migration must be done with caution. People who have been planning to uproot for years might prepare by earning an additional degree or putting aside savings to offset the costs of relocation; climate migrants may not have time for such investments when faced with local environmental collapse. Economic migrants—those with longer-anticipated moves to improve their earning prospects or standard of living—might choose their destinations on the basis of language or cultural affinity, on top of job opportunities. Climate migrants, by contrast, may undergo a more scattered and less planned migration. (Indeed, that’s what Hornbeck’s research finds.)
Granted, economic and climate migrants may have some similarities. “It is not the differences in mean income levels [in a potential immigrant’s home versus destination countries] that determine the extent of migration, but the differences in mean income levels net of migration costs,” wrote Borjas. “These migration costs will be both monetary and psychic.” He argued that the psychic costs of migration to the US are higher for people whose home cultures are very different from American culture. While Borjas was writing about immigrants arriving on US shores for any number of unspecified reasons (including, for example, political revolutions at home), it makes some sense that people who have decided to abandon their life’s work in the face of climate disaster, possibly with little to no recompense, will also suffer high psychic costs.
Still, concluding that climate migrants are like all others could blur our understanding of their motives—and mean we fail to anticipate the consequences of their migration. The challenge becomes reducing the noise so that we can make more-definitive statements about climate migrants in particular.
For example, in the 1930s, many people left Oklahoma and other parts of the Great Plains because of widespread permanent erosion. But others migrated due to the Great Depression more generally, or in response to government policies, technological changes, and other events of the time. University of Arizona’s Price Fishback, Syracuse’s William Horrace, and Shawn Kantor at Florida State, in research published in 2006, explain that New Deal policies between 1933 and 1939 acted as magnets to parts of the US with good infrastructure for public-works projects, and may have drawn many American workers away from farming, particularly because federal support for agriculture was focused on landowners, not their hired laborers.
The experience of these workers serves less well as a model for predicting the movements of Zambians whose jobs are at risk due to water scarcity, Germans whose homes and shops were destroyed by flooding, or Californians anxious about the health impacts of forest-fire smoke.
Hornbeck began looking at the Dust Bowl more than a decade ago, using US census data on population, agriculture, and manufacturing. Increasingly intensive farming in the early 20th century left land vulnerable to drought. Without deep prairie grasses anchoring the earth and helping retain moisture, when severe drought descended on the region in the 1930s, the result was devastating erosion; soil turned to dust and blew away in suffocating, blackout flurries. Caroline Henderson, whose letters from Oklahoma were published at the time in the Atlantic, described some farms covered hip-deep in ash, others simply swept clean of plowable earth.
Indeed, while the Dust Bowl moniker covered counties in six US states, the experience differed considerably across those counties—a variation Hornbeck analyzed to understand the impact on local economies. He saw that land values in more eroded counties dropped more precipitously than in less eroded counties, with little adjustment in crop choice. His analysis suggests that economies adjusting to environmental shocks might rely heavily on the movement of people: mass migration away from the Dust Bowl’s most eroded counties—rather than adaptation within the agricultural sector—turned out to be the primary means by which these areas began to adjust after 1940.
The public release of the 1940 census has made it possible to take a closer look at the migrants who moved away from areas that saw the most destruction during the Dust Bowl.
Hornbeck resisted drawing conclusions about the migrants themselves because the data available at the time did not allow him to distinguish between climate migration and more general migration. US Census Bureau records pertaining to individuals cannot be released to the public until 72 years after they are collected; therefore, while Hornbeck could see how the population of a county rose or fell between 1930 and 1940, he had no way of knowing who was causing these ebbs and flows.
The individual-level data from the 1940 Census is now available, enabling researchers to identify who migrated by looking at names that disappeared in one county and reappeared in another. Name changes due to marriage make linking women from one census to another difficult, however, and shared names or misspellings can lead to mismatches that falsely inflate migration rates and affect analyses of who migrates.
Hornbeck was able to sidestep these issues thanks to a question in the 1940 census that asked people where they had been living in 1935. This let him also generally “move beyond identifying impacts of the Dust Bowl on more-eroded counties and identify impacts of the Dust Bowl on people from more-eroded counties,” he writes. It also meant he could distinguish between climate migrants (whom he defines as the additional people, on top of a baseline amount of other migrants, who left the counties where the soil was most eroded) from more general migrants (whom he defines as all people leaving less eroded counties).
He finds notable differences: climate migrants were more likely to move further—for example, to California, as in Steinbeck’s The Grapes of Wrath—than those leaving less eroded zones. They also moved to more scattered locations, whereas general migrants tended to concentrate in particular destinations, which suggests a more planned migration.
In terms of schooling, the additional migrants from more eroded counties were less educated than those who stayed behind, in contrast with the general understanding that migrants have more education than nonmigrants. “The main striking pattern is that migrants generally have higher levels of education, but this was much less true for migrants induced to leave by the Dust Bowl,” says Hornbeck.
And these Dust Bowl migrants earned less money in their new homes than migrants from less eroded counties—although everyone leaving the Great Plains had lower incomes, on average, than the locals at their destinations.
Hornbeck notes that a greater array of people moved than he had expected—hired hands as well as landowners, workers outside agriculture as well as farmers, women as well as men. These individuals faced considerable hardship in their new homes, socially as well as financially—and yet the Dust Bowl yielded “remarkably modest impacts” on wages of all people from the worst-hit counties, compared with “substantial” and “enduring impacts” on land values, he says.
A broader definition of climate change–induced migration also complicates our sense of when someone becomes a migrant.
Comparing the two types of 1930s migrants tells us a lot about them, and could help us understand people being displaced by climate change almost a century later. Migrants today may well be different from people who left the Great Plains, in myriad ways. Yet the differences between today’s climate migrants and today’s other migrants is what the Dust Bowl can help illuminate.
Consider the political reaction to the Dust Bowl migrants. “How society reacts to migrants depends on who they are,” says Hornbeck. “The Dust Bowl was unusual in US history for white, internal migrants facing such hostile reactions in the places they arrived. And that may well have been related to them having been less educated and with lower incomes than average in their new destinations.”
If the same education and income patterns persist for today’s climate migrants, will they face similar hostility? A better understanding of these dynamics could help policy makers anticipate a number of things, including political reactions that end up shaping policy decisions, both in communities at high risk of climate disaster and those likely to receive new migrants.
In the US, the expected surge in climate-induced migration is set against a backdrop of decreased immigration (both documented and not) to the country in recent years, and sharply falling internal migration volumes over the past several decades. According to the annual Current Population Survey, 1.4 percent of US residents moved states in 2021, compared with 1.6 percent in 2011 and 2.9 percent in 1991—more than a 50 percent decline in 30 years.
University of Chicago’s Greg Kaplan and the Federal Reserve Bank of Chicago’s Sam Schulhofer-Wohl argue that two things in particular are driving this decline: the job market has become more homogeneous across geographies, reducing the economic advantages of moving, and there’s better access to information about the places people might move, thanks not just to the internet, but also to cheaper long-distance calling rates and lower travel costs. The researchers find in a 2017 study that this additional information deterred people who might have moved more than it spurred potential migrants to take the plunge.
But information that’s encouraging can increase migration, other research demonstrates—in which case information could be an important factor as climate migration accelerates. Economists William Carrington, Enrica Detragiache, and Tara Vishwanath, all at Johns Hopkins at the time, developed a model in the 1990s for understanding migration that includes information shared through networks of contacts. Their analysis helps explain why the Great Migration of Black Americans from the South to the North, for example, only began decades after the end of the Civil War—despite an almost immediate difference in wages and quality of life for Black people in the North versus the South.
Will we recognize climate migrants, especially when some weather events cause temporary shocks rather than permanent environmental change? University of Colorado at Boulder’s Myron Gutmann and Vincenzo Field, then a student at the University of Chicago Law School, pointed out in 2010 that we need to distinguish between people moving in response to sudden events such as earthquakes or tornadoes, those responding to “environmental hardship” such as drought, those seeking out “environmental amenities” including mild weather or proximity to water, and those moving because of “environmental barriers and their management,” ranging from air conditioning to flood control. All of these people will be affected differently by global warming—and how society reacts to migrants might also depend on whether it deems them genuine climate refugees across these categories.
A broader definition of climate change–induced migration also complicates our sense of when someone becomes a migrant. Local and federal “managed retreat” policies set up to mitigate the impact of climate change underscore this. The Federal Emergency Management Agency awards grants, for example, that are meant to give communities incentives to move infrastructure ahead of rather than in response to potential disasters. Other programs, such as those meant to preserve wetlands, include private landowners in their remit. Any climate migrants affected by this sort of forward planning might, then, have time to prepare for their dislocations by saving cash or continuing their education—much like other immigrants have done before them.
They might also have time to take advantage of newly accessible information to lower the psychic cost of a move, finding new locations that are culturally aligned with their old ones, or that boast strong job markets. And this combination of time and information might increase the rate of “positive self-selection,” or people with above-average earning power or higher education choosing to migrate.
Southern Methodist University’s Klaus Desmet and UChicago’s Esteban Rossi-Hansberg modeled the impact of global warming on global welfare in a 2015 analysis and find that as people relocate to places more suitable for activities such as agriculture and manufacturing, migration will be critical for mitigating the negative economic effects of climate change. Introducing more restrictions on movement than exist now would negate this phenomenon, with the most deleterious effects for residents of regions most hurt by rising global temperatures. “Global warming is particularly problematic in the presence of moving frictions,” they write. “Migration policy should therefore become an integral part of the debate on how to limit the negative economic impact of climate change.”
Archival data and empirical analysis can help us understand this integral part of the adaptation process. We have a great deal of experience understanding modern migration, Hornbeck notes, but little sense of how many of the migrants we see in news photos, who are moving in search of work or away from war, differ from those who will because climate change permanently reshapes the environment around them. It’s possible that the scale of migration ahead will be bigger than anything the world has experienced before, and of a different nature. But there is some historical precedent for this movement of people—and value in drawing on it.
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