JUE Insight: How do cities change when we work from home?

By Matthew J. Delventhal, Eunjee Kwon, A. Parkhomenko. Journal of Urban Economics, 2021

158 citations recorded by the source corpus.

Abstract How would the shape of our cities change if there were a permanent increase in working from home? We study this question using a quantitative model of the Los Angeles metropolitan area featuring local agglomeration externalities and endogenous traffic congestion. We find three important effects: (1) Jobs move to the core of the city, while residents move to the periphery. (2) Traffic congestion eases and travel times drop. (3) Average real estate prices fall, with declines in core locations and increases in the periphery. Workers who are able to switch to telecommuting enjoy large welfare gains by saving commute time and moving to more affordable neighborhoods. Workers who continue to work on-site enjoy modest welfare gains due to lower commute times, improved access to jobs, and the fall in average real estate prices.

Subfields: Economics and Econometrics, Transportation

View Paper: https://www.semanticscholar.org/paper/7de37feb90d0bcc30afcb94088b40d7241017515

Citations in the corpus

• The impact of the COVID-19 pandemic on the demand for density: Evidence from the U.S. housing market (2020, unknown): “This paper contributes to the literature on how city structures hange in the presence of the dispersion forces of diseases (Davis t al., 2021; Delventhal et al., 2021).”