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How Does Improvement in Commuting Affect Employees? Evidence from a Natural Experiment

Author

Listed:
  • Yao Lu

    (Tsinghua University)

  • Xinzheng Shi

    (Tsinghua University)

  • Jagadeesh Sivadasan

    (University of Michigan)

  • Zhufeng Xu

    (School of Economics at the Central University of Finance and Economics)

Abstract

We collect worker month-level panel data from two companies in Beijing for a two-year period before and after the opening of a nearby subway station, which significantly improved public transportation commutes for some workers. We find a significant difference-in-differences increase (12.6% of the standard deviation) in bonus pay, which is strongly correlated to worker-level performance measures, for affected workers relative to unaffected coworkers. We find no evidence that the improved performance is a result of affected workers spending extra time at the workplace. We find suggestive evidence for a relative decline in turnover, consistent with a gain in utility for affected workers.

Suggested Citation

  • Yao Lu & Xinzheng Shi & Jagadeesh Sivadasan & Zhufeng Xu, 2024. "How Does Improvement in Commuting Affect Employees? Evidence from a Natural Experiment," The Review of Economics and Statistics, MIT Press, vol. 106(1), pages 53-67, January.
    • Handle: RePEc:tpr:restat:v:106:y:2024:i:1:p:53-67
    DOI: 10.1162/rest_a_01138
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