Germany like many other European countries subsidize commuting by granting the right to deduct commuting expenses from … the subsidy should be even higher. Furthermore, the different policy packages cause a very differentiated pattern … urban sprawl characterized by suburbanization of residences and jobs, increasing commuting distances and spatial city growth …

German metropolitan area. In extension to most studies focusing on only one kind of subsidy, we compare the effects of … account. The results suggest that optimal subsidy levels are either small or even zero. While subsidizing public transport is … predominantly automobile. In contrast, pure commuting subsidies hardly affect aggregate urban welfare, but distributional effects …