Unemployment and Transport Poverty: Evidence From Australian Households

ABSTRACT Transportation is crucial in modern society because it improves access to essential services, employment opportunities, and recreational activities. Examining the implications of transport poverty is therefore an important public policy issue. To add to the literature and policy, we examine the impact of transport poverty on unemployment at the household level. Using three different measures of transport poverty, we find that transport poverty increases unemployment at the household level. We find this effect to be relatively larger after addressing the endogeneity inherent in our preferred measures of transport deprivation using heteroskedasticity‐based identification and an instrumental variable strategy. Our mediation analysis shows that employees deprived of access to affordable and reliable transport services spend more time traveling to work, increasing the risk of job instability.