Commuting pays off: Evidence on wage returns to inter-urban and intra-urban commuting

Abstract

The distance a person is willing to commute has a direct influence on her/his employment opportunities and wage level. It raises a lot of interesting questions, especially whether intra-urban commuting (due to a welldeveloped transport infrastructure, geographical concentration of job opportunities, etc.) is connected with any wage returns, and how they differ in comparison with those of inter-urban commuting. This article uses three data-sets at national (N-1 = 1,884; N-2 = 933) and local (N-3 = 3,193) levels from the Czech Republic, and different approximations of commuting in order to contribute to the discussion. It provides robust evidence on positive wage returns to both inter-urban and intra-urban commuting, comparable with Western countries. The differences between large national and limited urban labour markets are reflected in functional form: wage returns are linear for intra-urban and non-linear for inter-urban commuting. The article also explores the validity of different measures of commuting time and distance provided by the on-line application Mapy.cz, and suggests that it represents a suitable approximation in the case of missing or limited data.