European Regional Science Association
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European Regional Science Association
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The abstract for paper number 465:
Jos Van Ommeren, Free University
Department Of Spatial Economics, Amsterdam, The Netherlands
Commuting, housing and labour markets: the role of market imperfections
The main objectives of this study is to give an overview of the relationship between commuting and mobility behaviour in the labour and housing market. This relationship has been analysed by means of theoretical models mainly making use of search theory going back to the work of Sugden (1980) and Simpson (1980). Recently, the use of matching models has become increasingly popular to explain commuting behaviour (Zenou, 2002). Matching theory essentially extends search theory by focusing on employees and employers search, allowing for an equilibrium approach. Search and matching theory has been mainly applied to explain individual commuting and mobility behaviour. In a few cases however, matching theory has been successfully applied to explain commuting patterns on a meso level. The current study demonstrates that search theory may explain why spatial interaction models are successful in explaining commuting flows. Moreover, search theory may contribute to the explanation why static urban models are relatively unsuccessful to explain commuting flows.Market imperfections (transaction costs, uncertainty) are at the heart of search theory/matching theory. Clearly, given the absence of market imperfections one would not expect any relationship between commuting and mobility behaviour. In the current study, we will also develop some new ideas how market imperfections will affect rent and wage gradients in urban areas.
Search/matching theory has been extensively applied in the last 20 years to investigate the empirical relationship between commuting and mobility behaviour. Most contributions can be found in the microeconometric literature. A large number of studies has shown that the commuting length increases residential and job mobility, indicating that workers are not fully compensated for the commuting costs. Studies which aim to understand how market imperfections directly influence commuting behaviour are more limited.
Unfortunately full paper has not been submitted.