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ABSTRACT Low rates of internal migration in many European countries contribute to the persistence of significant regional labor market differences. I use the Mikrozensus, a large annual sample of households living in Germany, to further our understanding of the underlying reasons. This paper makes two main contributions: first, the paper quantifies the disutility of migrating. To this end, I estimate conditional logit models of the migration decision across the German federal states. Second, I then focus on the differences between immigrants and natives. I find significantly higher responsiveness to labor market differentials in the immigrant population than in the native population. Unobserved moving costs for immigrants are estimated to be only about 31 percent of this same cost for natives. The findings bear on the assessment of the economic impact of immigration, and the paper contributes to the current immigration-related policy debates that feature prominently in many European countries, and that likely will continue to be important in light of the ongoing EU expansion and the resulting east-west migration. [ABSTRACT FROM AUTHOR]