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A Structural Estimation of the Employment Effects of Offshoring in the U.S. Labor Market

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  • Wei, Xuan
  • Meng, Xianwei
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    Abstract

    The value of statistical life (VSL) is one of the most scrutinized and controversial parameters estimated by environmental economists (Cameron 2009, Viscusi 2010), largely due to the wide use of VSL estimates to value the mortality risk benefits of regulations that affect public health and safety (OMB 2011, Robinson and Hammitt 2010). The hedonic wage method has been a primary source of VSL estimates for use in applied benefit‐cost analysis and there have been several meta‐analyses of these studies, including examinations of publication bias. We build on the existing literature by focusing on the coefficient on fatal risk rather than the VSL itself. This allows for larger sample sizes and reflects more recent methods that provide a cleaner test for bias. Results suggest that publication bias is present in the full sample of hedonic wage VSL estimates and that correcting for this by using those observations with the most precise estimates results in lower mean VSL estimates.

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    Bibliographic Info

    Paper provided by Agricultural and Applied Economics Association in its series 2013 Annual Meeting, August 4-6, 2013, Washington, D.C. with number 150730.

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    Date of creation: 2013
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    Handle: RePEc:ags:aaea13:150730

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    Keywords: Offshoring; Employment; Monotonic Cubic Spline Interpolation; Offshoring Cost; Labor and Human Capital; F14; F16; C14;

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    1. Gene M. Grossman & Esteban Rossi-Hansberg, 2006. "Trading Tasks: A Simple Theory of Offshoring," NBER Working Papers 12721, National Bureau of Economic Research, Inc.
    2. Chiara Criscuolo & Luis Garicano, 2010. "Offshoring and Wage Inequality: Using Occupational Licensing as a Shifter of Offshoring Costs," American Economic Review, American Economic Association, vol. 100(2), pages 439-43, May.
    3. David H. Autor & Frank Levy & Richard J. Murnane, 2003. "The Skill Content Of Recent Technological Change: An Empirical Exploration," The Quarterly Journal of Economics, MIT Press, vol. 118(4), pages 1279-1333, November.
    4. Alan S. Blinder & Alan B. Krueger, 2009. "Alternative Measures of Offshorability: A Survey Approach," Working Papers 1169, Princeton University, Department of Economics, Center for Economic Policy Studies..
    5. Avraham Ebenstein & Ann Harrison & Margaret McMillan & Shannon Phillips, 2009. "Why are American Workers getting Poorer? Estimating the Impact of Trade and Offshoring Using the CPS," NBER Working Papers 15107, National Bureau of Economic Research, Inc.
    6. Bardhan, Ashok Deo & Kroll, Cynthia, 2003. "The New Wave of Outsourcing," Fisher Center for Real Estate & Urban Economics, Research Reports qt02f8z392, Fisher Center for Real Estate & Urban Economics, UC Berkeley.
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