Does Commuting Reduce Wage Disparities?

This article shows that in the Baltic countries, commuting reduces urban-rural wage and employment disparities and increases national output. To quantify the effect of commuting wage differentials, two sets of earnings functions are estimated (based on Estonian, Latvian, and Lithuanian Labor Force Surveys) with location variables (capital city, rural, etc.) measured at the workplace and at the place of residence. The author finds that the ceteris paribus wage gap between capital city and rural areas as well as between capital and other cities is significantly narrowed by commuting in some cases but remains almost unchanged in others. Different outcomes are explained by country-specific spatial patterns of commuting, educational and occupational composition of commuting flows, and presence or absence of wage discrimination against rural residents in urban markets. A treatment effects model is used to estimate individual wage gains to rural-urban or inter-city commuting; these gains are substantial in most but not all cases. Wage effects of commuting distance as well as impact of education, gender, ethnicity, and local labor market conditions on the commuting decision are also explored.


  • English

Media Info

  • Media Type: Print
  • Pagination: pp 360-390
  • Serial:
    • Growth and Change
    • Volume: 35
    • Issue Number: 3
    • Publisher: Blackwell Scientific Publications Limited
    • ISSN: 0017-4815

Subject/Index Terms

Filing Info

  • Accession Number: 01000691
  • Record Type: Publication
  • Files: TRIS
  • Created Date: Jun 3 2005 12:35PM