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Getting to work: Experimental evidence on job search and transportation costs

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  • Phillips, David C.

Abstract

Do transportation costs constrain job search in urban low wage labor markets? I test this question by providing transit subsidies to randomly selected clients of a non-profit employment agency. The subsidies generate a large, short-run increase in search intensity for a transit subsidy group relative to a control group receiving standard job search services but no transit subsidy. In the first two weeks, individuals assigned to the transit subsidy group apply and interview for 19% more jobs than those not receiving subsidies. The subsidies generate the greatest increase in search intensity for individuals living far from employment opportunities. Some suggestive evidence indicates that greater search intensity translates into shorter unemployment durations. These results provide experimental evidence in support of the theory that search costs over space can depress job search intensity, contributing to persistent urban poverty in neighborhoods far from job opportunities.

Suggested Citation

  • Phillips, David C., 2014. "Getting to work: Experimental evidence on job search and transportation costs," Labour Economics, Elsevier, vol. 29(C), pages 72-82.
  • Handle: RePEc:eee:labeco:v:29:y:2014:i:c:p:72-82
    DOI: 10.1016/j.labeco.2014.07.005
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    Cited by:

    1. Mayer, Thierry & Mayneris, Florian & Py, Loriane, 2012. "The Impact of Urban Enterprise Zones on Establishments' Location Decisions: Evidence from French ZFUs," CEPR Discussion Papers 9074, C.E.P.R. Discussion Papers.
    2. Thierry Mayer & Florian Mayneris & Loriane Py, 2017. "The impact of Urban Enterprise Zones on establishment location decisions and labor market outcomes: evidence from France," Journal of Economic Geography, Oxford University Press, vol. 17(4), pages 709-752.
    3. Girum Abebe & Stefano Caria & Marcel Fafchamps & Paolo Falco & Simon Franklin & Simon Quinn, 2017. "Anonymity or Distance? Job Search and Labour Market Exclusion in a Growing African City," SERC Discussion Papers 0224, Spatial Economics Research Centre, LSE.
    4. repec:eee:juecon:v:104:y:2018:i:c:p:1-15 is not listed on IDEAS
    5. Simon Franklin, 2016. "Location, Search Costs and Youth Unemployment: Experimental Evidence from Transport Subsidies in Addis Ababa," SERC Discussion Papers 0199, Spatial Economics Research Centre, LSE.
    6. Gerards, Ruud & Welters, Ricardo, 2016. "Impact of financial pressure on unemployed job search, job find success and job quality," ROA Research Memorandum 008, Maastricht University, Research Centre for Education and the Labour Market (ROA).
    7. Ana I. Moreno-Monroy, 2016. "Access to public transport and labor informality," IZA World of Labor, Institute for the Study of Labor (IZA), pages 274-274, July.
    8. Simon Franklin, 2015. "Location, search costs and youth unemployment: A randomized trial of transport subsidies in Ethiopia," CSAE Working Paper Series 2015-11, Centre for the Study of African Economies, University of Oxford.
    9. repec:eee:deveco:v:130:y:2018:i:c:p:99-112 is not listed on IDEAS
    10. Phillips, David C. & Sandler, Danielle, 2015. "Does public transit spread crime? Evidence from temporary rail station closures," Regional Science and Urban Economics, Elsevier, vol. 52(C), pages 13-26.
    11. Rosa Sanchis-Guarner, 2012. "Driving Up Wages: The Effects of Road Construction in Great Britain," SERC Discussion Papers 0120, Spatial Economics Research Centre, LSE.
    12. Girum Abebe & Stefano Caria & Marcel Fafchamps & Paolo Falco & Simon Franklin & Simon Quinn, 2016. "Curse of Anonymity or Tyranny of Distance? The Impacts of Job-Search Support in Urban Ethiopia," NBER Working Papers 22409, National Bureau of Economic Research, Inc.

    More about this item

    Keywords

    Search costs; Spatial mismatch; Public transit; Urban poverty;

    JEL classification:

    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • R4 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics

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