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This article tests whether workers are indifferent between risky and safe jobs provided that, in labor market equilibrium, wages should serve as a utility equalizing device. Workers’ preferences are elicited through a partial measure of overall job satisfaction: satisfaction with job-related risk. Given that selectivity turns out to be important, we use selectivity corrected models. Results show that wage differentials do not exclusively compensate workers for being in dangerous jobs. However, as job characteristics are substitutable in workers’ utility, they could feel satisfied, even if they were not fully compensated financially for working in dangerous jobs.

The institution of tenure has elicited debate and controversy since its introduction in higher education. Proponents argue the need for tenure based on academic freedom and efficient university governance. Critics argue that it represents inefficiency in the higher education labor market and protects less productive faculty members. The use of tenure in academic libraries has been no less controversial, with only 40−60% of academic libraries supporting tenure track positions for academic librarians. This dichotomy in the labor market for academic librarians represents a natural experiment and allows for the testing of the presence of a compensating wage differential for tenure.

This study examines 10 years’ worth of cross-sectional data drawn from member libraries of the Association of Research Libraries (ARL). Models examine both the institutional characteristics of tenure-granting ARL academic libraries and the impact of tenure on starting salaries. Issues related to both a union wage premium and a compensating wage differential due to tenure are explored. The results of this research suggest that tenure, while serving other functions within an academic library setting, does not have the predicted impact on starting salaries.

This paper seeks to connect changes in the structure of wages at the occupation level to measures of the task content of jobs. We first present a simple model where skills are used to produce tasks, and changes in task prices are the underlying source of change in occupational wages. Using Current Population Survey (CPS) wage data and task measures from the O*NET, we document large changes in both the within and between dimensions of occupational wages over time, and find that these changes are well explained by changes in task prices likely induced by technological change and offshoring.

This paper is a study of how people with heterogonous individual characteristics self-select into different compensation schemes. A laboratory experiment is designed in which “workers” can join “companies” that pay according to various schemes: piece rate, revenue sharing, individual tournament, and team tournament. The main findings are: (1) Subjects with high relative performance always prefer individual tournament. (2) Risk-averse subjects are less likely to choose competitive schemes. (3) Individual tournament attracts fewer women than men, which is partially explained by gender-specific social preferences. (4) Compared to people with siblings, only children are less likely to accept any team-based schemes without information about their teammates. (5) The provision of feedback about relative performance can adjust individuals’ biased self-beliefs and then influence their self-selections.

The objective of this paper is to analyse the role of adverse working conditions in the determination of individual wages and job satisfaction in the Finnish labour market.

The paper uses estimation of econometric models for wages and job satisfaction scores by using the Quality of Work Life Survey of Statistics Finland.

The paper finds that adverse working conditions have a very minor role in the determination of individual wages. In contrast, adverse working conditions substantially decrease the level of job satisfaction and the perception of fairness of pay at the workplace. This evidence speaks against the existence of compensating wage differentials, but is consistent with the view that the Finnish labour market functions in a non‐competitive fashion.

Provides useful information for improvement of working conditions.

Very few papers have analysed the data sets that include, besides wages and job satisfaction scores, detailed information on several different aspects of self‐reported working conditions at the workplace, not just conditions typical of some occupations or industries.

Using the Canadian Census of 2016, the present study examines the Black and White gap in compensating differentials for their commute to work.

The data are from the Canadian Census of 2016. The standard Mincerian wage regression, augmented by commute-related variables and their confounders, is estimated by OLS. The estimations use sample weights and heteroscedasticity robust standard errors.

In the standard Mincerian wage regressions, Black men are found to earn non-negligibly less than White men. No such gap is found among women. When the Mincerian wage equation is augmented by commute duration and its confounders, commute duration is revealed to positively predict wages of White men and negatively associate with wages of Black men. At the same time, in the specifications including commute duration and its confounders, the coefficient for the dummy variable identifying Black men is positive with a non-negligible size. The latter pattern indicates wage discrepancies among Black men by their commute duration. Again, no difference is found between Black and White women in these estimations.

The main caveat is that due to data limitations, causal estimates could not be produced.

For the Canadian working men, the uncovered patterns indicate both between and within race gaps in the impact of commuting on wages. Particularly, Black men seem to commute longer towards relatively lower paying jobs, while the opposite holds for their White counterparts. However, Black men who reside close to their work earn substantially more than both otherwise identical White men and Black men who live far away from their jobs. The implications for research and policy are discussed.

This is the first paper focused on commute compensating differentials by race using Canadian data.

The most enduring measure of how individuals make personal decisions affecting their health and safety is the compensating wage differential for job safety risk revealed in the labor market via hedonic equilibrium outcomes. The decisions in turn reveal the value of a statistical life (VSL), the value of a statistical injury (VSI), and the value of a statistical life year (VSLY), which have both mortality and morbidity aspects that we describe and apply here. All such tradeoff rates play important roles in policy decisions concerning improving individual welfare. Specifically, we explicate the recent empirical research on VSL and its related concepts and link the empirical results to the ongoing examinations of many government policies intended to improve individuals' health and longevity. We pay special attention to recent issues such as the COVID pandemic and newly emerging foci on distributional consequences concerning which demographic groups may benefit most from certain regulations.

In this chapter, we investigate two-way causality between health and the hourly wage. We employ insights from the human capital and compensating wage differential models, a panel formed from the National Longitudinal Survey of Youth 1997, and dynamic panel estimation methods in this investigation. We adopt plausible specifications in which a change in health induces a change in the wage with a lag and a change in the wage induces a change in health, also with a lag. We uncover a causal relationship between two of the five measures of health and the wage in which a reduction in health leads to an increase in the wage rate in a panel of US young adults who had completed their formal schooling by 2006 and were continuously employed from that year through 2011. There is no evidence of a causal relationship running from the wage rate to health in this panel. The former result highlights the multidimensional nature of health. It is consistent with an extension of the compensating wage differential model in which a large amount of effort in one period is required to obtain promotions and the wage increases that accompany them in subsequent periods. That effort may cause reductions in health and to a negative effect of health in the previous period on the current period wage. In this framework, employees have imperfect information about the effort requirements of a particular job when they are hired, and employers have imperfect information about the amount of effort new hirers are willing to exert. The result is also consistent with a model in which investments in career advancement compete with investments in health for time – the ultimate scarce resource. The lack of a causal effect of the wage on health may suggest that forces that go in opposite directions in the human capital and compensating wage differential models offset each other.

To analyse two important effects of the level of social concern in the firm. First, the effect on the labour force composition, i.e. do particular types of concerns attract certain kinds of employees? Second, the effect on the wage level within the firm, i.e. do firm‐provided social concerns substitute for money wages, or are they provided as an additional compensation?

Empirical analysis using a survey on more than 2,000 firms, linked to administrative data for each employee in the firms. Estimates wage equations using the IV approach to deal with endogeneity of the level of social concerns. Two competing theories aiming to explain the use of social concerns toward employees, the compensating wage differential theory and corporate social responsibility, are compared.

Finds indications in favour of the compensating wage differential theory when looking at wage effects at the firm level, whereas looking at the target group level finds that white‐collar workers might experience higher levels of social concerns without having lower wages, which contrast the theory of compensating wage differentials.

The paper compare two well‐established theories within two different disciplines – the compensating wage differential theory from economics, and CSR from management. This is done using solid empirical analysis.

Drawing upon compensating differentials, equity theory, and the psychological contract, women’s voices illustrate how organisational policy dissemination, implementation and change can lead to unintended assignee dissatisfaction with reward. Implications arise for organisational justice which can affect women’s future expatriation decisions. The paper aims to discuss these issues.

A qualitative case study methodology was employed. Reward policies for long-term international assignments (IAs) were analysed. In-depth semi-structured interviews were conducted confidentially with 21 female long-term assignees selected using stratified sampling, and with two managers responsible for international reward policy design/implementation.

Policy transparency is required. Women perceive inequity when allowances based on grade are distorted by family status. Women in dual career/co-working couples expect reward to reflect their expatriate status. Reward inequity is reported linked to specific home/host country transfers. Policy change reducing housing and children’s education are major causes of reward dissatisfaction.

This case study research was cross-sectional and set within one industry. It addressed reward outcomes only for long-term IAs from the perspectives of women who had accepted expatriation in two oil and gas firms.

Reward policy should be transparent. Practitioners might consider the inter-relationship between policy elements depending on grade and accompanied status, location pairings, and the effects of policy content delivery to dual career/co-working couples.

This paper advances the field of IA reward by examining compensating differentials, equity and the psychological contract and takes these forward via implications for organisational justice. It identifies reward elements that support women’s expatriation and address their low share of expatriate roles, thereby fostering gender diversity. Future research themes are presented.