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Extra Status and Extra Stress: Are Promotions Good for Us?

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  • Johnston, David W.

    ()
    (Monash University)

  • Lee, Wang-Sheng

    ()
    (Deakin University)

Abstract

Promotions ordinarily involve higher wages and greater privileges; but they also often involve increased responsibility, accountability and work hours. Therefore, whether promotions are good for workers' wellbeing is an empirical question. Using high-quality panel data we estimate pre- and post-promotion effects on job attributes, physical health, mental health and life satisfaction, in an attempt at answering this question. We find that promotions substantially improve job security, pay perceptions and overall job satisfaction in the short term, and that promotions have short and longer term effects on job control, job stress, income and hours worked. However, despite these large effects on job attributes, we find that promotions have negligible effects on workers' health and happiness. Only mental health seems affected, with estimates suggesting significant deterioration two years after receiving a promotion. Thus, it seems the additional stress involved with promotions eventually outweighs the additional status, at least for the average worker.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 6675.

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Length: 32 pages
Date of creation: Jun 2012
Date of revision:
Publication status: published in: Industrial and Labor Relations Review, 2013, 66 (1), 32-54
Handle: RePEc:iza:izadps:dp6675

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Keywords: status; stress; job satisfaction; promotion;

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  1. Christopher J. Boyce & Andrew J. Oswald, 2012. "Do people become healthier after being promoted?," Health Economics, John Wiley & Sons, Ltd., vol. 21(5), pages 580-596, 05.
  2. Nattavudh Powdthavee, 2011. "Anticipation, Free-Rider Problems, and Adaptation to Trade Unions: Re-examining the Curious Case of Dissatisfied Union Members," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 64(5), pages 1000-1019, October.
  3. Clark, Andrew E. & Diener, Ed & Georgellis, Yannis & Lucas, Richard E., 2006. "Lags and Leads in Life Satisfaction: A Test of the Baseline Hypothesis," IZA Discussion Papers 2526, Institute for the Study of Labor (IZA).
  4. Anne Case & Christina Paxson, 2010. "The Long Reach Of Childhood Health And Circumstance: Evidence From The Whitehall Ii Study," Working Papers 1215, Princeton University, Woodrow Wilson School of Public and International Affairs, Center for Health and Wellbeing..
  5. Greiner, Alfred, 2008. "An economic model of work-related stress," Journal of Economic Behavior & Organization, Elsevier, vol. 66(2), pages 335-346, May.
  6. Fischer, Justina AV & Sousa-Poza, Alfonso, 2007. "Does Job Satisfaction Improve The Health Of Workers? New Evidence Using Panel Data And Objective Measures Of Health," Working Paper Series in Economics and Finance 687, Stockholm School of Economics.
  7. van Vegchel, Natasja & de Jonge, Jan & Bosma, Hans & Schaufeli, Wilmar, 2005. "Reviewing the effort-reward imbalance model: drawing up the balance of 45 empirical studies," Social Science & Medicine, Elsevier, vol. 60(5), pages 1117-1131, March.
  8. Cutler, David & Lleras-Muney, Adriana & Deaton, Angus, 2006. "The Determinants of Mortality," Scholarly Articles 2640588, Harvard University Department of Economics.
  9. Rafael Di Tella & John Haisken-De New & Robert MacCulloch, 2007. "Happiness Adaptation to Income and to Status in an Individual Panel," NBER Working Papers 13159, National Bureau of Economic Research, Inc.
  10. Johnston, David W. & Lee, Wang-Sheng, 2011. "Climbing the Job Ladder: New Evidence of Gender Inequity," IZA Discussion Papers 5970, Institute for the Study of Labor (IZA).
  11. Brown, Gordon D. A. & Gardner, Jonathan & Oswald, Andrew J. & Qian, Jing, 2005. "Does Wage Rank Affect Employees' Wellbeing?," IZA Discussion Papers 1505, Institute for the Study of Labor (IZA).
  12. Griffin, Joan M. & Fuhrer, Rebecca & Stansfeld, Stephen A. & Marmot, Michael, 2002. "The importance of low control at work and home on depression and anxiety: do these effects vary by gender and social class?," Social Science & Medicine, Elsevier, vol. 54(5), pages 783-798, March.
  13. Francesconi, Marco, 2001. " Determinants and Consequences of Promotions in Britain," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 63(3), pages 279-310, July.
  14. Nicholas S. Souleles & Jonathan A. Parker & David S. Johnson, 2006. "Household Expenditure and the Income Tax Rebates of 2001," American Economic Review, American Economic Association, vol. 96(5), pages 1589-1610, December.
  15. Paul Frijters, 2005. "The causal effect of income on health: Evidence from German reunification," Paul Frijters Discussion Papers 2005-2, School of Economics and Finance, Queensland University of Technology.
  16. Paul Frijters & David W. Johnston & Michael A. Shields, 2011. "Life Satisfaction Dynamics with Quarterly Life Event Data," Scandinavian Journal of Economics, Wiley Blackwell, vol. 113(1), pages 190-211, 03.
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Cited by:
  1. Grimani, Katerina, 2014. "Labor earnings and Psychological well-being: An Empirical Analysis," MPRA Paper 57098, University Library of Munich, Germany.
  2. Buddelmeyer, Hielke & McVicar, Duncan & Wooden, Mark, 2013. "Non-Standard 'Contingent' Employment and Job Satisfaction: A Panel Data Analysis," IZA Discussion Papers 7590, Institute for the Study of Labor (IZA).

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