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Compensating wage differentials for job stress

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  • Michael French
  • Laura Dunlap
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    Abstract

    Recent medical studies have demonstrated a strong relationship between mental stress and cardiac events such as myocardial infarction and stroke. In the workplace, stress once accounted for less than 5% of all occupational disease claims, but it now accounts for over 15%. Although research on the effects of mental stress is increasing, few studies offer an economic perspective. In this paper, we examine the effects of job stress on weekly wages and explore the possibility that stress commands a compensating wage differential. Our findings suggest that, ceteris paribus, a wage differential does exist between workers experiencing mental stress and their 'non-stressed' cohorts. After controlling for other demographic and occupational factors, we found a statistically significant wage premium ranging from 3 to 10% attributable to mental stress. In addition, the magnitude of the differential varies by gender.

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    Bibliographic Info

    Article provided by Taylor & Francis Journals in its journal Applied Economics.

    Volume (Year): 30 (1998)
    Issue (Month): 8 ()
    Pages: 1067-1075

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    Handle: RePEc:taf:applec:v:30:y:1998:i:8:p:1067-1075

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    Cited by:
    1. Philippe Bocquier & Christophe Nordman & Aude Vescovo, 2010. "Employment Vulnerability and Earnings in Urban West Africa," Working Papers DT/2010/05, DIAL (Développement, Institutions et Mondialisation).
    2. Ambra Poggi, 2007. "Do Satisfactory Working Conditions Contribute to Explaining Earning Differentials in Italy? A Panel Data Approach," LABOUR, CEIS, vol. 21(4-5), pages 713-733, December.
    3. Rees, Daniel I. & Sabia, Joseph J., 2012. "Migraine Headache and Labor Market Outcomes," IZA Discussion Papers 7034, Institute for the Study of Labor (IZA).
    4. Nikolaos Georgantzis & Efi Vasileiou, 2012. "Are dangerous jobs paid better? European evidence," Working Papers 2012/18, Economics Department, Universitat Jaume I, Castellón (Spain).
    5. Fernández, Rosa M. & Nordman, Christophe J., 2009. "Are there pecuniary compensations for working conditions?," Labour Economics, Elsevier, vol. 16(2), pages 194-207, April.
    6. González Álvarez, Mª Luz & Gamero-Burón, Carlos, 2013. "Coste de las visitas médicas y urgencias asociadas al estrés laboral en España/Health Care Costs Due to Job Stress in Spain," Estudios de Economía Aplicada, Estudios de Economía Aplicada, vol. 31, pages 417-444, Septiembr.
    7. Jones, Melanie K. & Latreille, Paul L. & Sloane, Peter J., 2011. "Job Anxiety, Work-Related Psychological Illness and Workplace Performance," IZA Discussion Papers 5809, Institute for the Study of Labor (IZA).

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