Why Women in NYC Don't Work

Well, I wasn't expecting this answer. Dan Black, Lowell Taylor, and Natalia Kolesnikova have a new Federal Reserve (St Louis) working paper on the labor supply of women in NYC and Minneapolis. Here's the abstract:

Abstract. This paper documents two related little-noticed features of U.S. labor markets: (1) that there is currently substantial variation in the labor market participation rates and annual work hours of married women across cities, and (2) that the dramatic increase in married women’s labor supply over the past 60 years has varied substantially across cities in timing and magnitude. We focus on cross-city differences in commuting times as a potential explanation for this variation in women’s labor supply. Our starting point is the analysis of labor supply in a model in which commute times introduce non-convexities into the budget set. Empirical evidence appears consistent with the model’s predictions: In the cross section, labor force participation rates of married women are negatively correlated with the metropolitan area commuting time. Our analysis also indicates that metropolitan areas which experienced relatively large increases in average commuting time from 1980 through 2000 had slower growth in the labor force participation of married women.

This is a spillover from congestion externalities I hadn't thought of mattering - that people might actually work less because of the congestion in their area. In other words, economic growth and incomes suffer when congestion problems cannot be solved.

hattip to M-to-the-ar-g-to-the-in-a-to-the-l Revolution.