טכניון מכון טכנולוגי לישראל
הטכניון מכון טכנולוגי לישראל - בית הספר ללימודי מוסמכים  
M.Sc Thesis
M.Sc StudentMenachem Ofer
SubjectInequality,Income and Commuting
Do Changes in Commuting Characteristics Correlate
with Income and Inequality in the Place
of Residence?
DepartmentDepartment of Architecture and Town Planning
Supervisor Professor Pnina Plaut
Full Thesis text - in Hebrew Full thesis text - Hebrew Version


Abstract

Commuting and inequality are two central phenomena that characterize the work force in both developed and developing countries, and influence the majority of the world's population. Both phenomena are linked to municipal issues, economic growth, globalization and agglomeration. This research examines whether changes in the scope of commuting influence the inequality within regions and places.

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Agglomeration economies is one of the central mechanisms that contributes to the phenomenon of commuting. According to this mechanism work productivity and innovation increase as the size of the local employment market is bigger, encouraging centrality of employment and economies of scale. This approach explains the creation of large cities that contain large quantities of employers, employees, and firms. As a result, the salary paid in the large employment centers is substantially higher, which creates increased incentive to search for work there. However, the sprawling residential areas do not fully overlap with the places of employment, causing many of the workers to commute.

This research focuses on the following questions: based on the theory that has been described, 1) do changes in the characteristics and rates of commuting affect the salary of the workers and 2) Do they affect the overall inequality in the community? The analysis is based on data of the American Community Society (ACS) collected between the years 2005-2009 and 2010-2014. The method employed in this research is regression analysis in which the analyzed variables are income inequality, average salary and median salary.

This correlation has been examined both by using cross-section analysis for each of the two time periods and by examining the effect of the change in the variables on the change in salary and inequality. The correlation between these variables was examined in three different types of communities: those outside a metropolis, those in a metropolis, and those in central cities.

The findings show that commuting is correlated with reducing inequality for workers who live within the metropolis. Furthermore, it suggests that the average commute time is increased mainly for low income workers that have improved their income by finding a higher paid job, though further away. Reduced inequality did not happen only in the aspect of the ratio between the average salary and the median salary (that is to say a greater rise in the median salary compared to the rise in the average salary). In the central cities and in the communities outside the metropolis, the correlation of commuting is weaker and is not unambiguous.

These results support Kuznetz's theory regarding decreasing of regional inequality in developing countries. However, the findings of this report show that the communities who enjoy the proximity to a developed employment market can take better advantage of it to reduce inequality. Conversely, commuting does not have a similar effect on communities in large cities or those outside the metropolis.