The Value of Leisure Time and Commuting Paradox

Throughout last century the processes of urbanization are happening across all over the world, which leads to development of peripherical zones in big cities. From these zones newcomers are commuting to the city centers for work each day, spending a lot of time on this. Government policy towards increasing the utility of such commuters happens to be ineffective due to the existence of commuting time paradox. This paradox comes from the fact that households take into account several different additional factors except the main ones (relative wages, rents and tariffs) when deciding on where to live and whether to commute. These additional factors are shifting their utility curves and, hence bring inefficiencies to policies as they are not included in consideration by policymakers. This study tries to understand whether there is a commuting time paradox in Moscow agglomeration and which additional factors do have effect on commuters. By leveraging the data from CIAN, Yandex.Maps and CSCC (Central Suburban Commuters Company) and constructing the factor OLS model with fixed effects, the study confirmed the statistical significance of the main factors as well as the importance of rail station existence in neighborhood. Considered additional factors (number of rent offers, entertainment index, school index) seemed to be irrelevant and insignificant for total commuting time, concluding that there is no empirical evidence of commuting time paradox in Moscow agglomeration. It is supposed that policymakers should concentrate on wages, rents and tariffs optimization, as well as improving overall transportation infrastructure.