Locations of labor market entry by German university graduates: is (regional) beauty in the eye of the beholder?

We study location choices of German university graduates at labor market entry, relating them to employment opportunities, regional characteristics and graduates’ own geographic roots. About half of the students remain in the university region or return to their home region. In addition, graduates are significantly more likely to move to a region resembling their home region in settlement structure and dialect than to a dissimilar region. This finding, which is robust to controlling for employment opportunities and geographic distance, indicates that graduates prefer employment in regions similar to those where they originally grew up.