Government workers are able to gain better pay in attractive areas like California and Manhattan, especially if they are unionized

In recent years, many commentators have expressed growing concerns over levels of public sector pay. While citizens who are unhappy with high pay levels in the public sector could move elsewhere, thus affecting the tax base, in some areas this out-migration is much less likely than others. Jan K. Brueckner and David Neumark write that ‘high amenity’ areas such as California, for its climate, or Manhattan, for its productive density, are more attractive to citizens, which reduces the likelihood that they will vote with their feet over public sector pay, thus leading to better paid government workers in those areas.