Home Office: Evidence on Location and Selection Effects of Telecommuting

Telecommuting has increased during recent years, and the COVID-19 crisis has accelerated its development even further. Despite various opinions, causal evidence about the effect of telecommuting remains scarce and the implications for management accounting are unclear. In a computerized experiment designed to distinguish between location and selection effects, we study individuals' effort intensity and reporting. The results reveal no difference in effort intensity between the workplace and telecommuting, but individuals misreport more when telecommuting. This increased misreporting is due to a selection effect, where less honest individuals prefer to telecommute. A small-scale follow-up survey with practitioners corroborates our findings with respect to the reporting behavior. Moreover, although we again find no difference in effort intensity, the results provide preliminary evidence into location effects on other effort dimensions (duration, direction, and learning). Overall, our study shows that telecommuting has important implications for designing effective management control systems.