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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.

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.

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.

This paper uses data from the Cedefop European Skills and Jobs survey (ESJS) (Cedefop, 2014, ESJS microdata are Cedefop copyright and are reproduced with the permission of Cedefop. Further information is available at Cedefop, 2015), a new international dataset on skill mismatch of adult workers in 28 EU countries, to decompose the wage penalty of overeducated workers. The ESJ survey allows for integration of a rich set of variables in the estimation of the effect of overeducation on earnings, such as individuals’ job search motives and the skill needs of their jobs. Oaxaca decomposition techniques are employed to uncover the extent to which the earnings penalties of overeducated workers can be attributed to either (i) individual human capital attributes, (ii) job characteristics, (iii) information asymmetries, (iv) compensating job attributes, or (iv) assignment to jobs with different skill needs. Differences in human capital and job-skill requirements are important factors in explaining the wage premium. It is found that asymmetry of information accounts for a significant part of the overeducation wage penalty of tertiary education graduates, whereas job characteristics and the low skill content of their jobs can explain most of the wage gap for medium-qualified employees. Little evidence is found in favor of equilibrium theories of compensating wage differentials and career mobility. Accepting that much remains to be learned with regards to the drivers of overeducation, this paper provides evidence in support of the need for customized policy responses to tackle overeducation.

Economists and sociologists have proposed arguments for why there can exist wage penalties for work involving helping and caring for others, penalties borne disproportionately by women. Evidence on wage penalties is neither abundant nor compelling. We examine wage differentials associated with caring jobs using multiple years of Current Population Survey (CPS) earnings files matched to O*NET job descriptors that provide continuous measures of “assisting & caring” and “concern” for others across all occupations. This approach differs from prior studies that assume occupations either do or do not require a high level of caring. Cross-section and longitudinal analyses are used to examine wage differences associated with the level of caring, conditioned on worker, location, and job attributes. Wage level estimates suggest substantive caring penalties, particularly among men. Longitudinal estimates based on wage changes among job switchers indicate smaller wage penalties, our preferred estimate being a 2% wage penalty resulting from a one standard deviation increase in our caring index. We find little difference in caring wage gaps across the earnings distribution. Measuring mean levels of caring across the U.S. labor market over nearly thirty years, we find a steady upward trend, but overall changes are small and there is no evidence of convergence between women and men.

The purpose of this chapter is to assess the importance of individual social capital characteristics in determining wages, both directly through their valuation by employers and indirectly through their impact on individual occupational choice. We find that a person’s level of sociability and care for others works through both channels to explain wage differences between social and nonsocial occupations. Additionally, expected wages in each occupation type are found to be at least as important as a person’s level of social capital in choosing a social occupation. We make use of restricted 2000 Decennial Census and 2000 Social Capital Community Benchmark Survey.

Traditionally, hiring indefinite duration contract employees has been the dominant method used by U.S. organizations to staff their labor needs. Indefinite duration contract employees, hereafter referred to as “regular” employees, have three defining characteristics: (1) they are hired directly as employees of the organization whose work they perform; (2) the duration of the employment relationship is unspecified, with a mutual expectation that it will continue as long as it is mutually satisfactory; and (3) the employment relationship provides ongoing – as opposed to intermittent – work. When their demand for labor increases, organizations staffed exclusively by regular employees can respond by having their employees work overtime or by hiring additional regular employees. Conversely, when their demand for labor decreases, such organizations can either maintain “inventories” of excess regular employees or reduce labor inputs by laying-off or reducing the work hours of regular employees.

We survey the literature on the Risk Augmented Mincer equation that seeks to estimate the compensation for uncertainty in the future wage to be earned after completing an education. There is wide empirical support for the predicted positive effect of wage variance and the negative effect of wage skew. We discuss robustness of the findings across specifications, potential bias from unobserved heterogeneity and selectivity and consider the core issue of students' information on benefits from education.