Working from Home: Too Much of a Good Thing?

Kristian Behrens, Sergey Kichko, Jacques Thisse and Sergei Kichko

No 8831, CESifo Working Paper Series from CESifo

Abstract: We develop a general equilibrium model with three primary production factors—land, skilled, and unskilled labor—and three sectors—construction, intermediate inputs, and final consump-tion—to study how different intensities of telecommuting affect the efficiency of firms that embrace home working, as well as its impact on the whole economy. In doing so, we pay particular attention to the effects of increasing working from home (WFH) that go through changes in the production and consumption of buildings: more WFH reduces firms’ demands for office space, but increases workers’ demand for living space since additional room is re-quired to work from home. We find that more WFH is a mixed blessing: the relationship between telecommuting and productivity or GDP is ∩-shaped, whereas telecommuting raises income inequality. Hence, WFH is not a panacea since an excessive downscaling of workspaces may be damaging to all and exacerbate economic inequality.

Keywords: working from home; alternative work arrangements; telecommuting; housing and office markets; land (search for similar items in EconPapers)
JEL-codes: J20 R13 R14 (search for similar items in EconPapers)
Date: 2021
New Economics Papers: this item is included in nep-geo and nep-lma
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (41)

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Related works:
Journal Article: Working from home: Too much of a good thing? (2024)
Working Paper: Working from home: Too much of a good thing? (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_8831

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