The Role of Trans-Tasman Migration in Forecasting the New Zealand Population

Abstract

Population growth in New Zealand is rather volatile. International migration is the main cause of this. However, as is common in many countries, official population projections are based on a range of exogenously-set fixed levels of net migration. This article argues that, for the short to medium term, such projections can be improved upon by adopting econometric methodologies which take explicitly into account the demographic-economic two-way interaction in certain components of international migration. Specifically, the article summarizes research on the causes and consequences of trans-Tasman migration, which is the dominant component of the volatility in New Zealand's net migration. It is shown how these findings can aid population forecasting.