Commuting, Housing, and Labor Markets

  • Jan RouwendalEmail author
Living reference work entry


In the monocentric model, commuting is viewed as a burden whose cost shapes the spatial structure of cities to a considerable extent. This view has been challenged by the finding that actual commuting patterns are far from efficient. However, this “wasteful” commuting is better interpreted as an indication of labor market frictions that are traded off against commuting frictions than as a neglect of commuting costs. Urban sprawl results from the decreasing importance of physical space that was the consequence of the automobile and is fundamentally consistent with the basic insights of the monocentric model. Large and diversified urban labor markets flourish when space restrictions are relaxed because this facilitates the matching of jobs and workers along other dimensions. Having a large mortgage puts more stress on this allocation mechanism.


Labor market House price Housing market Residential location Reservation wage 


  1. Andersson F, Haltiwanger J, Kutzbach M, Pollakowski H, Weinberg D (2011) Job displacement and the duration of joblessness: the role of spatial mismatch. Working paper, US census bureauGoogle Scholar
  2. Costa D, Kahn ME (2000) Power couples: changes in the locational choice of the college educated, 1940–1990. Quart J Econ 115(4):1287–1315CrossRefGoogle Scholar
  3. Decreuse B, van Ypersele T (2011) Housing market regulation and the demand for job protection. J Public Econ 95(11–12):1397–1409CrossRefGoogle Scholar
  4. Duranton G, Puga D (2001) Nursery cities: urban diversity, process innovation and the life- cycle of product. Am Econ Rev 91(5):1454–1477CrossRefGoogle Scholar
  5. Flatau P, Forbes M, Hendershott PH, Wood G (2003) Homeownership and unemployment; the roles of leverage and public housing. NBER working paper 10021Google Scholar
  6. Gautier PA, Teulings CN (2003) An empirical index of labor market density. Rev Econ Stat 85(4):901–908CrossRefGoogle Scholar
  7. Gautier PA, Teulings CN (2009) Search and the city. Reg Sci Urban Econ 39(3):251–265CrossRefGoogle Scholar
  8. Gin A, Sonstelie J (1992) The streetcar and residential location in nineteenth century Philadelphia. J Urban Econ 32(1):92–107CrossRefGoogle Scholar
  9. Glaeser EL (1999) Learning in cities. J Urban Econ 46(2):254–277CrossRefGoogle Scholar
  10. Glaeser EL, Kahn ME (2004) Sprawl and Urban Growth. In: Hednerson JV, Thisse J-F (eds) Handbook of Regional and Urban Economics 4(56):2481–2528Google Scholar
  11. Hamilton BW (1982) Wasteful commuting. J Polit Econ 90(5):1035–1053CrossRefGoogle Scholar
  12. Hamilton BW (1989) Wasteful commuting again. J Polit Econ 67:1497–1504CrossRefGoogle Scholar
  13. Kain JF (1968) Housing segregation, negro unemployment, and metropolitan decentralization. Quart J Econ 82(2):175–197CrossRefGoogle Scholar
  14. LeRoy S, Sonstelie J (1983) Paradise lost and regained: transportation, innovation, income and residential location. J Urban Econ 13(1):67–89CrossRefGoogle Scholar
  15. Lucas RE, Rossi-Hansberg E (2002) On the internal structure of cities. Econometrica 70(4):1445–1476CrossRefGoogle Scholar
  16. Marshall A (1890) Principles of economics. Macmillan, HoudmillsGoogle Scholar
  17. Munch JR, Rosholm M, Svarer M (2006) Are home owners really more unemployed? Econ J 116(514):991–1013CrossRefGoogle Scholar
  18. Nickell SJ, Layard R (1999) Labour market institutions and economic performance. In: Ashenfelter A, Card D (eds) Handbook of labor economics, vol III. North Holland, Amsterdam, pp 3030–3084Google Scholar
  19. Oswald AJ (1996) A conjecture on the explanation for high unemployment in the industrialized nations; Part I. Working paper, University of WarwickGoogle Scholar
  20. Petrongolo B, Pissarides C (2001) Looking into the black box: a survey of the matching function. J Econ Lit 39(2):390–431CrossRefGoogle Scholar
  21. Phillips D (2011) Getting to work: experimental evidence on job search and transportation costs in Washington, DC. Working paper, Georgetown UniversityGoogle Scholar
  22. Pissarides C (2000) Equilibrium unemployment theory. MIT, CambridgeGoogle Scholar
  23. Rouwendal J (1998) Search theory, spatial labor markets and commuting. J Urban Econ 43(1):1–22CrossRefGoogle Scholar
  24. Rouwendal J (1999) Spatial job search and commuting distances. Reg Sci Urban Econ 29(4):491–517CrossRefGoogle Scholar
  25. Rouwendal J, Nijkamp P (2004) Living in two worlds: a review of home-to-work decisions. Growth Change 35(3):287–303CrossRefGoogle Scholar
  26. Small KA, Song S (1992) “Wasteful” commuting: a resolution. J Polit Econ 100(4):888–898CrossRefGoogle Scholar
  27. Teulings CN, Gautier PA (2004) The right man for the job. Rev Econ Stud 71:553–580CrossRefGoogle Scholar
  28. Van den Berg GJ, Gorter C (1997) Job search and commuting time. J Bus Econ Stat 15(2):269–281Google Scholar
  29. Van Ommeren J, van den Berg GJ, Gorter C (2000) Estimating the marginal willingness to pay for commuting. J Reg Sci 40(3):541–563CrossRefGoogle Scholar
  30. Van Vuuren A (2008) The relationship between expectations of labor market status, homeownership and the duration unemployment. Working paper, VU UniversityGoogle Scholar
  31. Wheaton WC (1977) Income and urban residence: an analysis of consumer demand for location. Am Econ Rev 67(4):620–631Google Scholar
  32. White MJ (1988) Urban commuting journeys are not wasteful. J Polit Econ 96(5):1097–1110CrossRefGoogle Scholar

Copyright information

© Springer-Verlag GmbH Germany, part of Springer Nature 2019

Authors and Affiliations

  1. 1.Department of Spatial EconomicsVU UniversityAmsterdamThe Netherlands

Personalised recommendations