Commute Costs and Labor Supply: Evidence from a Satellite Campus
AbstractWhether, and how much, increased commute costs decrease labor supply is important for transport policy, city growth, and business strategies. Yet empirical estimates are limited and biased downward due to endogenous choices of residences, workplaces, commute modes, and wages. We use the transition of undergraduate teaching from a Chinese university’s urban to suburban campus and ten years of complete course schedule data to test how teachers’ labor supply responds to a longer commute. Exogeneity is ensured because few faculty change residences, nearly all faculty ride a free shuttle bus, and we control for wage changes. Employing a regression discontinuity design, the 1.0 to 1.5-hour (40-kilometer) increase in round-trip commute time reduces annual undergraduate teaching by 56 hours or 23%. Consistent with higher per-day commute costs annual teaching days decrease by 27 while daily teaching hours increase by 0.49. Difference-in-difference estimates using faculty-specific changes in commute time corroborate these results ruling out aggregate confounders. Faculty substitute toward graduate teaching but decrease research output. The university accommodated the reduced teaching time primarily by increasing class sizes implying that education quality declined.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 53740.
Date of creation: 17 Feb 2014
Date of revision:
commuting; commute costs; labor supply; satellite campus;
Find related papers by JEL classification:
- I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions
- I25 - Health, Education, and Welfare - - Education - - - Education and Economic Development
- J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
- R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population
- R41 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Transportation: Demand, Supply, and Congestion
This paper has been announced in the following NEP Reports:
- NEP-ALL-2014-02-21 (All new papers)
- NEP-LAB-2014-02-21 (Labour Economics)
- NEP-LMA-2014-02-21 (Labor Markets - Supply, Demand, & Wages)
- NEP-TRE-2014-02-21 (Transport Economics)
- NEP-URE-2014-02-21 (Urban & Real Estate Economics)
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