IDEAS home Printed from https://ideas.repec.org/a/spr/jopoec/v37y2024i1d10.1007_s00148-024-00995-z.html
   My bibliography  Save this article

Do subways improve labor market outcomes for low-skilled workers?

Author

Listed:
  • Jindong Pang

    (Wuhan University)

  • Shulin Shen

    (Huazhong University of Science and Technology)

Abstract

This paper evaluates the labor market effects of subway systems on low-skilled workers. A simple model of labor supply predicts that access to subway services can decrease transportation costs and improve labor force participation, but has ambiguous effects on the intensive margin of labor market outcomes. Empirical estimates from US cities show that a 10% expansion in subway miles increases the labor force participation of low-skilled individuals without a car by eight percentage points. However, subway expansions have no significant effect on the labor force participation of low-skilled individuals who own automobiles or on high-skilled workers. In contrast, expansions of light rails and buses have no significant effect on the labor market outcomes of low-skilled individuals. Improved subway services do not affect wages, hours worked, and commuting times, suggesting that the labor market benefits of subways mainly lie in the extensive margin of labor supply.

Suggested Citation

  • Jindong Pang & Shulin Shen, 2024. "Do subways improve labor market outcomes for low-skilled workers?," Journal of Population Economics, Springer;European Society for Population Economics, vol. 37(1), pages 1-34, March.
    • Handle: RePEc:spr:jopoec:v:37:y:2024:i:1:d:10.1007_s00148-024-00995-z
    DOI: 10.1007/s00148-024-00995-z
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s00148-024-00995-z
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s00148-024-00995-z?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Yizhen Gu & Chang Jiang & Junfu Zhang & Ben Zou, 2021. "Subways and Road Congestion," American Economic Journal: Applied Economics, American Economic Association, vol. 13(2), pages 83-115, April.
    2. Clément de Chaisemartin & Xavier D'Haultfœuille, 2020. "Two-Way Fixed Effects Estimators with Heterogeneous Treatment Effects," American Economic Review, American Economic Association, vol. 110(9), pages 2964-2996, September.
    3. A. Colin Cameron & Jonah B. Gelbach & Douglas L. Miller, 2008. "Bootstrap-Based Improvements for Inference with Clustered Errors," The Review of Economics and Statistics, MIT Press, vol. 90(3), pages 414-427, August.
    4. David Card & Thomas Lemieux, 2001. "Can Falling Supply Explain the Rising Return to College for Younger Men? A Cohort-Based Analysis," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 116(2), pages 705-746.
    5. Nicolas Gendron-Carrier & Marco Gonzalez-Navarro & Stefano Polloni & Matthew A. Turner, 2022. "Subways and Urban Air Pollution," American Economic Journal: Applied Economics, American Economic Association, vol. 14(1), pages 164-196, January.
    6. Ian W. H. Parry & Kenneth A. Small, 2009. "Should Urban Transit Subsidies Be Reduced?," American Economic Review, American Economic Association, vol. 99(3), pages 700-724, June.
    7. James X. Sullivan, 2006. "Welfare Reform, Saving, and Vehicle Ownership: Do Asset Limits and Vehicle Exemptions Matter?," Journal of Human Resources, University of Wisconsin Press, vol. 41(1).
    8. Henry S. Farber & Jesse Rothstein & Robert G. Valletta, 2015. "The Effect of Extended Unemployment Insurance Benefits: Evidence from the 2012-2013 Phase-Out," American Economic Review, American Economic Association, vol. 105(5), pages 171-176, May.
    9. Michael L. Anderson, 2014. "Subways, Strikes, and Slowdowns: The Impacts of Public Transit on Traffic Congestion," American Economic Review, American Economic Association, vol. 104(9), pages 2763-2796, September.
    10. Michael J. Smart & Nicholas J. Klein, 2020. "Disentangling the role of cars and transit in employment and labor earnings," Transportation, Springer, vol. 47(3), pages 1275-1309, June.
    11. A. Colin Cameron & Jonah B. Gelbach & Douglas L. Miller, 2011. "Robust Inference With Multiway Clustering," Journal of Business & Economic Statistics, Taylor & Francis Journals, vol. 29(2), pages 238-249, April.
    12. Gilles Duranton & Matthew A. Turner, 2011. "The Fundamental Law of Road Congestion: Evidence from US Cities," American Economic Review, American Economic Association, vol. 101(6), pages 2616-2652, October.
    13. Terza, Joseph V. & Basu, Anirban & Rathouz, Paul J., 2008. "Two-stage residual inclusion estimation: Addressing endogeneity in health econometric modeling," Journal of Health Economics, Elsevier, vol. 27(3), pages 531-543, May.
    14. Couture, Victor & Handbury, Jessie, 2020. "Urban revival in America," Journal of Urban Economics, Elsevier, vol. 119(C).
    15. Holzer Harry J. & Ihlanfeldt Keith R. & Sjoquist David L., 1994. "Work, Search, and Travel among White and Black Youth," Journal of Urban Economics, Elsevier, vol. 35(3), pages 320-345, May.
    16. Jan K. Brueckner & Stuart S. Rosenthal, 2009. "Gentrification and Neighborhood Housing Cycles: Will America's Future Downtowns Be Rich?," The Review of Economics and Statistics, MIT Press, vol. 91(4), pages 725-743, November.
    17. Raphael, Steven & Rice, Lorien, 2002. "Car ownership, employment, and earnings," Journal of Urban Economics, Elsevier, vol. 52(1), pages 109-130, July.
    18. Gonzalez-Navarro, Marco & Turner, Matthew A., 2018. "Subways and urban growth: Evidence from earth," Journal of Urban Economics, Elsevier, vol. 108(C), pages 85-106.
    19. repec:eee:labchp:v:1:y:1986:i:c:p:3-102 is not listed on IDEAS
    20. Ioana Marinescu & Roland Rathelot, 2018. "Mismatch Unemployment and the Geography of Job Search," American Economic Journal: Macroeconomics, American Economic Association, vol. 10(3), pages 42-70, July.
    21. Laurent Gobillon & Harris Selod & Yves Zenou, 2007. "The Mechanisms of Spatial Mismatch," Urban Studies, Urban Studies Journal Limited, vol. 44(12), pages 2401-2427, November.
    22. Glaeser, Edward L. & Kahn, Matthew E. & Rappaport, Jordan, 2008. "Why do the poor live in cities The role of public transportation," Journal of Urban Economics, Elsevier, vol. 63(1), pages 1-24, January.
    23. Harry J. Holzer & John M. Quigley & Steven Raphael, 2003. "Public transit and the spatial distribution of minority employment: Evidence from a natural experiment," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 22(3), pages 415-441.
    24. Jeroen Bastiaanssen & Daniel Johnson & Karen Lucas, 2022. "Does better job accessibility help people gain employment? The role of public transport in Great Britain," Urban Studies, Urban Studies Journal Limited, vol. 59(2), pages 301-322, February.
    25. Ihlanfeldt, Keith R. & Sjoquist, David L., 1989. "The impact of job decentralization on the economic welfare of central city blacks," Journal of Urban Economics, Elsevier, vol. 26(1), pages 110-130, July.
    26. Heckman, James, 2013. "Sample selection bias as a specification error," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 31(3), pages 129-137.
    27. Baum, Charles L., 2009. "The effects of vehicle ownership on employment," Journal of Urban Economics, Elsevier, vol. 66(3), pages 151-163, November.
    28. Jeroen Bastiaanssen & Daniel Johnson & Karen Lucas, 2020. "Does transport help people to gain employment? A systematic review and meta-analysis of the empirical evidence," Transport Reviews, Taylor & Francis Journals, vol. 40(5), pages 607-628, July.
    29. Winston, Clifford & Maheshri, Vikram, 2007. "On the social desirability of urban rail transit systems," Journal of Urban Economics, Elsevier, vol. 62(2), pages 362-382, September.
    30. Pasha, Obed & Wyczalkowski, Chris & Sohrabian, Dro & Lendel, Iryna, 2020. "Transit effects on poverty, employment, and rent in Cuyahoga County, Ohio," Transport Policy, Elsevier, vol. 88(C), pages 33-41.
    31. Tao Li, 2020. "The Value of Access to Rail Transit in a Congested City: Evidence from Housing Prices in Beijing," Real Estate Economics, American Real Estate and Urban Economics Association, vol. 48(2), pages 556-598, June.
    32. Billings, Stephen B., 2011. "Estimating the value of a new transit option," Regional Science and Urban Economics, Elsevier, vol. 41(6), pages 525-536.
    33. Tyndall, Justin, 2021. "The local labour market effects of light rail transit," Journal of Urban Economics, Elsevier, vol. 124(C).
    34. Black, Dan A. & Kolesnikova, Natalia & Taylor, Lowell J., 2014. "Why do so few women work in New York (and so many in Minneapolis)? Labor supply of married women across US cities," Journal of Urban Economics, Elsevier, vol. 79(C), pages 59-71.
    35. Wheaton, William C., 1974. "A comparative static analysis of urban spatial structure," Journal of Economic Theory, Elsevier, vol. 9(2), pages 223-237, October.
    36. John F. Kain, 1968. "Housing Segregation, Negro Employment, and Metropolitan Decentralization," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 82(2), pages 175-197.
    37. Paul M. Ong, 2002. "Car ownership and welfare-to-work," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 21(2), pages 239-252.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Gautier, Pieter A. & Zenou, Yves, 2010. "Car ownership and the labor market of ethnic minorities," Journal of Urban Economics, Elsevier, vol. 67(3), pages 392-403, May.
    2. Gaduh, Arya & Gračner, Tadeja & Rothenberg, Alexander D., 2022. "Life in the slow lane: Unintended consequences of public transit in Jakarta," Journal of Urban Economics, Elsevier, vol. 128(C).
    3. Miwa Matsuo & Hiroyuki Iseki, 2020. "Giving up Job Search Because I Don't Have a Car: Labor Market Participation and Employment Status Among Single Mothers With and Without Cars," Discussion Paper Series DP2020-07, Research Institute for Economics & Business Administration, Kobe University.
    4. Nicholas Rivers & Soodeh Saberian & Brandon Schaufele, 2020. "Public transit and air pollution: Evidence from Canadian transit strikes," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 53(2), pages 496-525, May.
    5. Phillips, David C., 2014. "Getting to work: Experimental evidence on job search and transportation costs," Labour Economics, Elsevier, vol. 29(C), pages 72-82.
    6. Aliprantis, Dionissi & Martin, Hal & Tauber, Kristen, 2024. "What determines the success of housing mobility programs?," Journal of Housing Economics, Elsevier, vol. 65(C).
    7. Pérez, Jorge & Vial, Felipe & Zárate, Román, 2022. "Urban Transit Infrastructure: Spatial Mismatch and Labor Market Power," Research Department working papers 1992, CAF Development Bank Of Latinamerica.
    8. bunten, devin michelle & Fu, Ellen & Rolheiser, Lyndsey & Severen, Christopher, 2024. "The Problem Has Existed over Endless Years: Racialized Difference in Commuting, 1980–2019," Journal of Urban Economics, Elsevier, vol. 141(C).
    9. Antonio Di Paolo & Anna Matas & Josep Lluís Raymond, 2017. "Job accessibility and job-education mismatch in the metropolitan area of Barcelona," Papers in Regional Science, Wiley Blackwell, vol. 96, pages 91-112, March.
    10. Heilmann, Kilian, 2018. "Transit access and neighborhood segregation. Evidence from the Dallas light rail system," Regional Science and Urban Economics, Elsevier, vol. 73(C), pages 237-250.
    11. Baum, Charles L., 2009. "The effects of vehicle ownership on employment," Journal of Urban Economics, Elsevier, vol. 66(3), pages 151-163, November.
    12. Judith K. Hellerstein & David Neumark, 2011. "Employment in Black Urban Labor Markets: Problems and Solutions," NBER Working Papers 16986, National Bureau of Economic Research, Inc.
    13. Huiping Li & Harrison Campbell & Steven Fernandez, 2013. "Residential Segregation, Spatial Mismatch and Economic Growth across US Metropolitan Areas," Urban Studies, Urban Studies Journal Limited, vol. 50(13), pages 2642-2660, October.
    14. Åslund, Olof & Blind, Ina & Dahlberg, Matz, 2017. "All aboard? Commuter train access and labor market outcomes," Regional Science and Urban Economics, Elsevier, vol. 67(C), pages 90-107.
    15. Yizhen Gu & Chang Jiang & Junfu Zhang & Ben Zou, 2021. "Subways and Road Congestion," American Economic Journal: Applied Economics, American Economic Association, vol. 13(2), pages 83-115, April.
    16. Cho, Heepyung, 2022. "Driver’s license reforms and job accessibility among undocumented immigrants," Labour Economics, Elsevier, vol. 76(C).
    17. Antonio Di Paolo & Anna Matas & Josep Lluís Raymond, 2014. "Job accessibility, employment and job-education mismatch in the metropolitan area of Barcelona," Working Papers XREAP2014-05, Xarxa de Referència en Economia Aplicada (XREAP), revised May 2014.
    18. Nicolas Gendron-Carrier & Marco Gonzalez-Navarro & Stefano Polloni & Matthew A. Turner, 2022. "Subways and Urban Air Pollution," American Economic Journal: Applied Economics, American Economic Association, vol. 14(1), pages 164-196, January.
    19. Sari, Florent, 2015. "Public transit and labor market outcomes: Analysis of the connections in the French agglomeration of Bordeaux," Transportation Research Part A: Policy and Practice, Elsevier, vol. 78(C), pages 231-251.
    20. Fei Li & Christopher Kajetan Wyczalkowski, 2023. "How buses alleviate unemployment and poverty: Lessons from a natural experiment in Clayton County, GA," Urban Studies, Urban Studies Journal Limited, vol. 60(13), pages 2632-2650, October.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:jopoec:v:37:y:2024:i:1:d:10.1007_s00148-024-00995-z. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.