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Compensating wage differentials and shift work preferences

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  • Lanfranchi, Joseph
  • Ohlsson, Henry
  • Skalli, Ali

Abstract

Workers with difficult working conditions can be expected to be com-pensated by higher wages. They may, for example, choose shift work because of compensating wages but it is also possible that they prefer shift work. The previous empirical evidence is mixed. We study if there are compensating wages for shift work by estimating a switching regression model with endogenous switching using French matched employer–employee data for male full time blue collar workers. It is crucial to adjust for selectivity and not to pool data for shift and day workers. A main result is that there is a significant shift premium, the wage rate for shift workers is 16 percent higher than for day workers. A second main result is that the shift premium is significant for shift work choice. This premium compensates workers who do not self–select into shift work. A 1 percentage point increase in the premium increases the shift work probability by 0.87 percentage points.
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Suggested Citation

  • Lanfranchi, Joseph & Ohlsson, Henry & Skalli, Ali, 2002. "Compensating wage differentials and shift work preferences," Economics Letters, Elsevier, vol. 74(3), pages 393-398, February.
    • Handle: RePEc:eee:ecolet:v:74:y:2002:i:3:p:393-398
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • J28 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Safety; Job Satisfaction; Related Public Policy
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods

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