Why Do So Few Women Work in New York (And So Many in Minneapolis)? Labor Supply of Married Women across U.S. Cities

Abstract

This paper documents a little-noticed feature of U.S. labor markets -- very large variation in the labor supply of married women across cities. We focus on cross-city differences in commuting times as a potential explanation for this variation. We start with a model in which commuting times introduce non-convexities into the budget set. Empirical evidence is consistent with the model's predictions: Labor force participation rates of married women are negatively correlated with the metropolitan area commuting time. Also, metropolitan areas with larger increases in average commuting time in 1980-2000 had slower growth in the labor force participation of married women.

Keywords: female labor supply, local labor markets, commuting time, non-convex budget sets

JEL Classification: J21, J22, R23, R41