April 21, 2016
This paper examines the effect of commuting on life satisfaction. In order to evaluate the consequences of commuting, additional models test the effects of commuting on wages as well as satisfaction with both the work and the residential situation. The empirical analysis is based on longitudinal data from the German Socio-Economic Panel (GSOEP) for the period 1998-2009 and the Indicators and Maps on Spatial Development (INKAR) of the (German) Federal Institute for Research on Building, Urban Affairs, and Spatial Development. Fixed-effects models reveal a small but robust negative effect of commuting on life satisfaction. Furthermore, the results prove the expected positive relationship between commuting distance and earnings. Job and housing satisfaction are, however, not influenced by the distance between work and home. Consequently, commuting pays off financially but adversely affects life satisfaction.