(Spill-Over) effects of commuting subsidies on travel mode choice

Many employers provide commuting subsidies to their employees as part of their employment conditions, often without clear objectives to influence travel behaviour. This paper assesses the direct and spill-over effects of various commuter subsidy schemes on travel mode choice, using two waves of the Netherlands Travel Survey. The analysis differentiates between car-use-contingent and non-usage-contingent subsidies and investigates how their effects vary with the degree of urbanization, travel purpose, trip distance, and across population groups as defined by education level and migration background. The estimation results of multinomial logit models suggest that car-related subsidies not only increase the probability of motorized travel but also discourage the use of public transport and active travel modes. In contrast, non-usage-contingent subsidies appear to be more effective in more urbanized areas and for public transportation for longer distances. The findings highlight (unintended) behavioural influences and distributional consequences of commuting subsidies, suggesting the need to better align them with sustainability and equity goals in urban transport policy.