Does Commuting Reduce Wage Disparities?
AbstractThis paper shows that in the Baltic countries, commuting reduces urban- rural wage and employment disparities and increases national output. To quantify the effect of commuting on wage differentials, two sets of earnings functions are estimated (based on Estonian, Latvian, and Lithuanian Labor Force Surveys) with location variables (capital city, rural, etc.) measured at the workplace and at the place of residence. We find that the ceteris paribus wage gap between capital city and rural areas, as well as between capital and other cities is significantly narrowed by commuting in some cases but remains almost unchanged in other. Different outcomes are explained by country-specific spatial patterns of commuting, educational and occupational composition of commuting flows, and presence or absence of wage discrimination against rural residents in urban markets. A treatment effects model is used to estimate individual wage gains to rural—urban or inter-city commuting; these gains are substantial in most but not all cases. Wage effects of commuting distance, as well as impact of education, gender, ethnicity, and local labor market conditions on the commuting decision are also explored.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by EconWPA in its series Labor and Demography with number 0509012.
Length: 25 pages
Date of creation: 29 Sep 2005
Date of revision:
Note: Type of Document - pdf; pages: 25
Contact details of provider:
Web page: http://188.8.131.52
commuting; wage disparities; earnings functions; Baltic countries;
Other versions of this item:
- J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
- J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
- P52 - Economic Systems - - Comparative Economic Systems - - - Comparative Studies of Particular Economies
- R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
- R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population
This paper has been announced in the following NEP Reports:
- NEP-ALL-2005-10-04 (All new papers)
- NEP-EDU-2005-10-04 (Education)
- NEP-GEO-2005-10-04 (Economic Geography)
- NEP-LAB-2005-10-04 (Labour Economics)
- NEP-URE-2005-10-04 (Urban & Real Estate Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Mihails Hazans, 2003.
"Determinants of Inter-Regional Migration in the Baltic Countries,"
ERSA conference papers
ersa03p354, European Regional Science Association.
- Hazans, Mihails, 2003. "Determinants of inter-regional migration in the Baltic countries," ZEI Working Papers B 17-2003, ZEI - Center for European Integration Studies, University of Bonn.
- Zenou, Yves, 2000.
"Urban unemployment, agglomeration and transportation policies,"
Journal of Public Economics,
Elsevier, vol. 77(1), pages 97-133, July.
- Zenou, Yves, 1999. "Urban Unemployment, Agglomeration and Transportation Policies," CEPR Discussion Papers 2309, C.E.P.R. Discussion Papers.
- Daniel McFadden & Kenneth Train, 2000. "Mixed MNL models for discrete response," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 15(5), pages 447-470.
- Wasmer, Etienne & Zenou, Yves, 1999. "Does Space Affect Search? A Theory of Local Unemployment," CEPR Discussion Papers 2157, C.E.P.R. Discussion Papers.
- Zax, Jeffrey S., 1991. "Compensation for commutes in labor and housing markets," Journal of Urban Economics, Elsevier, vol. 30(2), pages 192-207, September.
- R.W. McQuaid, 2001. "Unemployed Job Seeker Attitudes towards Potential Travel-to-Work Times," Growth and Change, Gatton College of Business and Economics, University of Kentucky, vol. 32(3), pages 355-368.
- Brueckner, Jan K. & Martin, Richard W., 1997. "Spatial mismatch: An equilibrium analysis," Regional Science and Urban Economics, Elsevier, vol. 27(6), pages 693-714, November.
- Jan Rouwendal & Erik Meijer, 2001. "Preferences for Housing, Jobs, and Commuting: A Mixed Logit Analysis," Journal of Regional Science, Wiley Blackwell, vol. 41(3), pages 475-505.
- Brueckner, Jan & Thisse, Jacques-François & Zenou, Yves, 2000.
"Local Labour Markets, Job Matching and Urban Location,"
CEPR Discussion Papers
2612, C.E.P.R. Discussion Papers.
- Jan K. Brueckner & Jacques-FranÁois Thisse & Yves Zenou, 2002. "Local Labor Markets, Job Matching, and Urban Location," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 43(1), pages 155-171, February.
- BRUECKNER, Jan K. & THISSE , Jacques-François & ZENOU, Yves, . "Local labor markets, job matching, and urban location," CORE Discussion Papers RP -1545, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Newell, Andrew T., 2001. "The Distribution of Wages in Transition Countries," IZA Discussion Papers 267, Institute for the Study of Labor (IZA).
- Zax, Jeffrey S & Kain, John F, 1996.
"Moving to the Suburbs: Do Relocating Companies Leave Their Black Employees Behind?,"
Journal of Labor Economics,
University of Chicago Press, vol. 14(3), pages 472-504, July.
- Zax, J.S. & Kain, J.F., 1991. "Moving to the Suburbs: Do Relocating Companies Leave Their Black Employees Behind?," Harvard Institute of Economic Research Working Papers 1562, Harvard - Institute of Economic Research.
- Puhani, Patrick A, 2000. " The Heckman Correction for Sample Selection and Its Critique," Journal of Economic Surveys, Wiley Blackwell, vol. 14(1), pages 53-68, February.
- Richard Arnott, 1997. "Economic Theory and the Spatial Mismatch Hypothesis," Boston College Working Papers in Economics 390., Boston College Department of Economics.
- Coulson, N Edward & Laing, Derek & Wang, Ping, 2001. "Spatial Mismatch in Search Equilibrium," Journal of Labor Economics, University of Chicago Press, vol. 19(4), pages 949-72, October.
- Wrede, Matthias, 2001. "Should Commuting Expenses Be Tax Deductible? A Welfare Analysis," Journal of Urban Economics, Elsevier, vol. 49(1), pages 80-99, January.
- Kim S. So & Peter F. Orazem & Daniel M. Otto, 2001.
"The Effects of Housing Prices, Wages, and Commuting Time on Joint Residential and Job Location Choices,"
American Journal of Agricultural Economics,
Agricultural and Applied Economics Association, vol. 83(4), pages 1036-1048.
- So, Kim Sui & Orazem, Peter & Otto, Daniel, 2009. "The Effect of Housing Prices, Wages, and Commuting Time on Joint Residential and Job Location Choices," Staff General Research Papers 4050, Iowa State University, Department of Economics.
- So, Kim S. & Orazem, Peter F. & Otto, Daniel M., 1998. "The Effects Of Housing Prices, Wages, And Commuting Time On Joint Residential And Job Location Choices," 1998 Annual meeting, August 2-5, Salt Lake City, UT 20779, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
- Webster, David, 2000. "The Geographical Concentration of Labour-Market Disadvantage," Oxford Review of Economic Policy, Oxford University Press, vol. 16(1), pages 114-28, Spring.
- Hazans, Mihails, 2005. "Unemployment and the earnings structure in Latvia," Policy Research Working Paper Series 3504, The World Bank.
- Giovanni Russo & Federico Tedeschi & Aura Reggiani & Peter Nijkamp, 2011.
"Commuter Effects on Local Labour Markets: A German Modelling Study,"
Tinbergen Institute Discussion Papers
11-114/3, Tinbergen Institute.
- Giovanni Russo & Peter Nijkamp & Aura Reggiani & Federico Tedeschi, 2011. "Commuters' effect on local labour markets: A german case study," ERSA conference papers ersa10p1376, European Regional Science Association.
- Mihails Hazans, 2003. "Returns to Education in the Baltic Countries," SSE Riga/BICEPS Research Papers 2003-1, Baltic International Centre for Economic Policy Studies (BICEPS) and Stockholm School of Economics in Riga (SSE Riga).
- Ieva Brauksa & Ludmila Fadejeva, 2013. "Internal Labour Market Mobility in 2005-2011: The Case of Latvia," Working Papers 2013/02, Latvijas Banka.
- Budy P. Resosudarmo & Asep Suryahadi & Raden Purnagunawan & Athia Yumna & Asri Yusrina, 2009. "The Socioeconomic and Health Status of RuralÃ¢â‚¬â€œUrban Migrants in Indonesia," Development Economics Working Papers 23042, East Asian Bureau of Economic Research.
- Sandow, Erika & Westin, Kerstin, 2010. "The persevering commuter - Duration of long-distance commuting," Transportation Research Part A: Policy and Practice, Elsevier, vol. 44(6), pages 433-445, July.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (EconWPA).
If references are entirely missing, you can add them using this form.