(Some of) The macroeconomics of working from home

John Lewis

Increased working from home (WFH) for public health reasons during the pandemic has spawned a debate about whether this shift might become permanent. In this post, I try to sketch out some of the (macro) economics of a longer-run post-pandemic shift towards more WFH. I argue that: i) on consumption, it won’t affect aggregate expenditure, it will just reallocate it across space and sectors ii) in property markets, effects hinge on supply responses; iii) for output, cost-savings to firms from cutting back office space don’t translate one-for-one into GDP gains.

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