Does Working from Home Work? Evidence from a Chinese Experiment

About 10% of US employees now regularly work from home (WFH), but there are concerns this can lead to "shirking from home."We report the results of a WFH experiment at CTrip, a 16,000-employee, NASDAQ-listed Chinese travel agency.Call center employees who volunteered to WFH were randomly assigned to work from home or in the office for 9 months.Home working led to a 13% performance increase, of which about 9% was from working more minutes per shift (fewer breaks and sick-days) and 4% from more calls per minute (attributed to a quieter working environment).Home workers also reported improved work satisfaction and experienced less turnover, but their promotion rate conditional on performance fell.Due to the success of the experiment, CTrip rolled-out the option to WFH to the whole firm and allowed the experimental employees to re-select between the home or office.Interestingly, over half of them switched, which led to the gains from WFH almost doubling to 22%.This highlights the benefits of learning and selection effects when adopting modern management practices like WFH.