Thomas De Graaff
Regional Economics
, Amsterdam, The Netherlands, Jos Van Ommeren, Free University
Regional Economics
, Amsterdam, The Netherlands
The Effect of Firm Behaviour on Travel Behaviour - Do Company Cars Increase both the Employees' Commuting Distance and the Non-work-related Travel Times of Households? (assigned to theme
In most European countries, the use of company cars is common. In the Netherlands, 43% of all new personal cars sold are company cars, just above the European average (42%). It has been estimated that about 15 percent of all personal cars are company cars. The share of kilometres by company cars is thought to be much higher, because most employees who make use of a company car do not pay for fuel, insurance and maintenance. Essentially, for most employees in possession of a company car, the monetary travel costs are close to zero (with the exception of variable fines). This may have a number of consequences. One of the consequences might be that jobseekers are more likely to accept longer commuting distances when the job offer includes a company car. Further, it is plausible that employees who have a company car are more likely to move residence to locations, which are further from the workplace. In this paper, we investigate whether the employees' possession of a company car determines the commuting distance travelled. We take into account that possession of a company car is an endogenous variable, because the decision to accept a job offer includes the company car. We have instrumented possession of a company car with the travel distance during work hours. Interpretation of the results is facilitated by focusing on employees with a fixed workplace. Interpretation of the results can be improved by selecting only car users (private and company car users) and to instrument possession of car with the travel time by car during work hours. In this case, it makes sense to focus on commuting time as well. Further, and more importantly, we investigate the effect of the company car on travel time (for a group of car owners).
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