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Are there pecuniary compensations for working conditions?

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  • Fernández, Rosa M.
  • Nordman, Christophe J.

Abstract

In this paper we assess the relative contribution of working conditions to wage determination with an emphasis on differences along the earnings distribution. A survey of British employees in 2001 rich in questions regarding the job post enables us to separate the contribution of working conditions, job attributes and individual characteristics to the process of wage determination. Standard wage equations reveal that covariates such as having "repetitive job" and using generic skills such as "literacy" or "customer handling skills" are associated with significant premiums and penalties. Quantile regressions confirm the presence of penalties to poor working conditions, such as "working to tight deadlines", that are significant in the middle section of the earnings distribution and robust to the inclusion of a wide range of controls for person, firm and other job characteristics. Counterfactual decompositions at quantiles show that, despite the apparent penalty, there are pecuniary compensations to poor working conditions around the first quartile and the median of the earnings distribution.

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Bibliographic Info

Article provided by Elsevier in its journal Labour Economics.

Volume (Year): 16 (2009)
Issue (Month): 2 (April)
Pages: 194-207

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Handle: RePEc:eee:labeco:v:16:y:2009:i:2:p:194-207

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Web page: http://www.elsevier.com/locate/labeco

Related research

Keywords: Working conditions Compensating differentials Generic skills Quantile regressions Counterfactual earnings decompositions;

References

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Citations

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Cited by:
  1. Christophe Nordman & Faly Rakotomanana & François Roubaud, 2012. "Informal versus Formal: A Panel Data Analysis of Earnings Gaps in Madagascar," Working Papers DT/2012/12, DIAL (Développement, Institutions et Mondialisation).
  2. Lechmann, Daniel S. J., 2013. "Can working conditions explain the return-to-entrepreneurship puzzle?," Discussion Papers 86, Friedrich-Alexander-University Erlangen-Nuremberg, Chair of Labour and Regional Economics.
  3. Pasquier-Doumer, Laure & Nordman, Christophe Jalil, 2011. "Transitions and Occupational Changes in a West African Urban Labour Market: The Role of Social Network," Economics Papers from University Paris Dauphine 123456789/11236, Paris Dauphine University.
  4. Roubaud, François & Nordman, Christophe Jalil & Nguyen, Huu Chi, 2013. "Who Suffers the Penalty? A Panel Data Analysis of Earnings Gaps in Vietnam," Economics Papers from University Paris Dauphine 123456789/12321, Paris Dauphine University.
  5. Bocquier, Philippe & Nordman, Christophe Jalil & Vescovo, Aude, 2010. "Employment Vulnerability and Earnings in Urban West Africa," Economics Papers from University Paris Dauphine 123456789/4294, Paris Dauphine University.
  6. Christophe Nordman & Laure Pasquier-Doumer, 2013. "Transitions in a West African Labour Market: The Role of Social Networks," Working Papers DT/2013/12, DIAL (Développement, Institutions et Mondialisation).
  7. Böckerman, Petri & Ilmakunnas, Pekka & Johansson, Edvard, 2011. "Job security and employee well-being: Evidence from matched survey and register data," Labour Economics, Elsevier, vol. 18(4), pages 547-554, August.
  8. Böckerman, Petri & Ilmakunnas, Pekka & Johansson, Edvard, 2009. "Creative destruction and employee well-being," MPRA Paper 15447, University Library of Munich, Germany.

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