Wages and Commuting: Quasi-natural Experiments' Evidence from Firms that Relocate

Ismir Mulalic, Ninette Pilegaard, Jos N. Van Ommeren

Research output: Contribution to conferencePaperResearchpeer-review

Abstract

We examine the causal effect of commuting distance on workers' wages in a quasi-natural experiments setting using information on all workers in Denmark. We account for endogeneity of distance by using changes in distance that are due to firms’ relocations. A one kilometre increase in commuting distance induces a wage increase of about 0.42%, suggesting an hourly commuting time compensation of 49% of the hourly net wage. Our findings are consistent with wage bargaining theory and due to the experimental setup we are able to exclude many competing explanations of the wage-distance relationship.
Original languageEnglish
Publication date2010
Publication statusPublished - 2010
Externally publishedYes
EventThe 5th Kuhmo-Nectar Conference 2010 - University of Valencia, Valencia, Spain
Duration: 5 Jul 20109 Jul 2010
Conference number: 5

Conference

ConferenceThe 5th Kuhmo-Nectar Conference 2010
Number5
LocationUniversity of Valencia
CountrySpain
CityValencia
Period05/07/201009/07/2010

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