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The Provision and Valuation of Non-wage Job Attributes

Paper Session

Friday, Jan. 5, 2018 2:30 PM - 4:30 PM

Pennsylvania Convention Center, 104-A
Hosted By: American Economic Association
  • Chair: Kevin Lang, Boston University

Price Shocks and Worker Safety: Evidence from Mining

Kerwin Kofi Charles
,
University of Chicago
Matthew S. Johnson
,
Duke University
Melvin Stephens Jr.
,
University of Michigan
Do Q. Lee
,
University of Chicago

Abstract

Occupational injuries and illnesses in the U.S. are estimated to have an annual social cost of over \$250 billion. While worker injuries can be costly to firms, preventing injuries requires investments that firms may lack the resources to make. Consistent with this premise, prior studies have found that changes in firms’ economic position that relax financial constraints lead to improved safety and health outcomes. However, shocks to firms’ output prices may have an ambiguous effect the provision of safety. On the one hand, a positive price shock has an income effect that may relax financial constraints to investments in safety (like equipment upgrading). On the other hand, a positive shock may increase the opportunity cost of investments in safety that require time (like training and maintenance). We assess this relationship empirically in the context of the U.S. metals and non-metals mining sector, an industry in which safety is a particularly salient component of compensation. We find exogenous positive shocks to mine revenue, arising from short-term variation in global commodity prices, lead to a substantial increase in the risk of workplace injuries. This effect is not explained fully by changes in worker composition, or in workers’ decisions to report injuries. We also find positive shocks lead to lower compliance with workplace safety and health regulations.

Hours Constraints, Occupational Choice, and Gender: Evidence From Medical Residents

Melanie Wasserman
,
University of California-Los Angeles

Abstract

Are the long, inflexible work hours required by many high-paying professions a barrier to entry for women? I explore this question by studying the introduction of a policy in 2003 that capped the average workweek for medical residents at 80 hours. Using data on the universe of U.S. medical school graduates from 1993 to 2010, I find that when a specialty reduces its weekly hours, more women enter the specialty, whereas there is little change in men’s entry. To shed light on why women and men respond differently to the reform, I analyze physicians’ family formation choices during residency. I link female resident physicians to administrative birth records from two large U.S. states and find that reducing a specialty’s weekly hours increases its female fertility rate in California, but has no effect in Texas. I discuss these results in the context of a model in which individuals choose work and family investments during their early careers, trading off long-term incomes, investments in children, and leisure.

Labor Supply and the Value of Nonwork Time: Experimental Estimates From the Field

Alexandre Mas
,
Princeton University
Amanda Pallais
,
Harvard University

Abstract

The flow value of nonwork time relative to a worker's marginal product (MVT) is a crucial parameter in many macroeconomic models, including search models that seek to explain wage dispersion and the business cycle volatility of unemployment and vacancies. However, there is limited direct measurement of this quantity. We use a field experiment to estimate this parameter. During the application process to staff a national call center and data entry positions we randomly offered applicants alternative hour and wage packages. Applicant choices over these packages yield estimates for the labor supply function, and the MVT.

Preference for the Workplace, Investment in Human Capital, and Gender

Matthew Wiswall
,
University of Wisconsin-Madison
Basit Zafar
,
Federal Reserve Bank of New York

Abstract

We use a hypothetical choice methodology to estimate preferences for workplace attributes and quantify how much these preferences influence pre-labor market human capital investments. This method robustly identifies preferences for various job attributes, free from omitted variable bias and considering the equilibrium job match. Women on average have a higher willingness-to-pay (WTP) for jobs with greater work flexibility and job stability, and men have a higher WTP for jobs with higher earnings growth. These job preferences relate to college major choices and actual job choices, and explain as much as 25 percent of the gender wage gap.
Discussant(s)
Brent Richard Hickman
,
University of Chicago
Kevin Lang
,
Boston University
Kurt Lavetti
,
Ohio State University
Danielle Li
,
Harvard Business School
JEL Classifications
  • J3 - Wages, Compensation, and Labor Costs