Commuter Effects on Local Labour Markets: A German Modelling Study

Abstract

This paper offers an exploratory investigation of the effects of inbound commuter flows on employment in regional labour markets in Germany. For this purpose, the paper distinguishes three main channels that may transmit the effects concerned: a crowding-out mechanism and two labour demand effects—namely, an aggregate demand effect and a positive externality on vacancy creation. The results bring to light that, on the whole, commuter flows have a positive and robust effect on both employment and the number of jobs in the receiving labour market districts, but a distinctly negative effect on the share of jobs filled by resident workers. The implications of the results are interpreted and, finally, ways are suggested in which the analysis could be improved and expanded.