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Estimating the marginal willingness to pay for commuting

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  • Ommeren, Jos van

    (Vrije Universiteit Amsterdam, Faculteit der Economische Wetenschappen en Econometrie (Free University Amsterdam, Faculty of Economics Sciences, Business Administration and Economitrics)

  • Berg, Gerard J. van den
  • Gorter, Cees

Abstract

With informational frictions on the labor market, hedonic wage regressions provide biased estimates of the willingness to pay for job attributes. We show that a recent theoretical result, which states that variation in job durations does provide good estimates in case of a basic on-the-job search model, can be generalized to a wide class of search models. We apply this result by estimating the marginal willingness of employed workers to pay for commuting, using Dutch longitudinal data. The average willingness to pay for one hour commuting is estimated to equal almost half of the hourly wage rate.

Suggested Citation

  • Ommeren, Jos van & Berg, Gerard J. van den & Gorter, Cees, 1998. "Estimating the marginal willingness to pay for commuting," Serie Research Memoranda 0046, VU University Amsterdam, Faculty of Economics, Business Administration and Econometrics.
    • Handle: RePEc:vua:wpaper:1998-46
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    job search; commuting distance; job durations; hedonic wages;
    All these keywords.

    JEL classification:

    • J32 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Nonwage Labor Costs and Benefits; Retirement Plans; Private Pensions
    • J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods

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