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Inefficiencies in regional commuting policy**We thank the editors of the special issue, three anonymous referees and the participants of the 2011 ERSA Summer School for helpful comments. Financial support of the IWT†SBO Flemosi and the SUSTAINCITY – FP7 projects is gratefully acknowledged

Author

Listed:
  • Vandyck, Toon
  • Proost, Stef

Abstract

This paper studies commuting between a more productive and a less productive region. Both regions can tax or subsidize commuters and facilitate the commuting flow through transport investments. We show how strategic behaviour by regional governments may arise and lead to underinvestment in interregional transport infrastructure. This result can be reproduced in a setting with agglomeration or congestion externalities. A numerical example applies the insights to commuting in Belgium.

Suggested Citation

Handle: RePEc:eee:paresc:v:91:y:2012:i:3:p:659-689
DOI: 10.1111/j.1435-5957.2012.00437.x
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JEL classification:

  • H73 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Interjurisdictional Differentials and Their Effects
  • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
  • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
  • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population
  • R48 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government Pricing and Policy
  • R53 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Public Facility Location Analysis; Public Investment and Capital Stock

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