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Low-pay higher pay and job satisfaction within the European Union: empirical evidence from fourteen countries

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Author Info

  • Luis Diaz-Serrano

    ()
    (National University of Ireland Maynooth, IZA and CREB)

  • Jose A. Cabral Vieira

    ()
    (University of the Azores and CEEAplA)

Abstract

We examine differences in job satisfaction between low- and higher-paid workers within the European Union (EU). To do so The European Community Household Panel Data covering the period 1994-2001 is used. Then we test for differences in reported job satisfaction between low- and higher-paid workers. We also explain the existence of differences in the determinants of job satisfaction between these two types of workers and across countries. Our results indicate that low paid workers report a lower level of job satisfaction when compared with their higher paid counterparts in most countries, except in the UK. This supports the idea that low-wage employment in these countries mainly comprises low quality. The results also indicate that gap in average job satisfaction between low- and higher-paid workers is markedly wider in the Southern European countries than in the rest of EU. Finally, there are significant differences in the determinants of job satisfaction across countries. It seems then that a homogeneous policy may be inappropriate to increase satisfaction, and hence labour productivity, in the EU as a whole. Hence, an improvement of the quality of the jobs in the EU may require different policies. In particular, in some countries such as the United Kingdom removing low employment, namely through regulation, may worsen the workers’ well-being, although in other cases such a policy may lead to a totally different outcome.

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Bibliographic Info

Paper provided by Department of Economics, Finance and Accounting, National University of Ireland - Maynooth in its series Economics, Finance and Accounting Department Working Paper Series with number n1560405.

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Length: 26 pages
Date of creation: Apr 2005
Date of revision:
Handle: RePEc:may:mayecw:n1560405

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Postal: Maynooth, Co. Kildare
Phone: 353-1-7083728
Fax: 353-1-7083934
Web page: http://economics.nuim.ie
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Keywords: Job satisfaction; job quality; low-wage employment;

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References

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  8. Lorenzo Cappellari, 1999. "Low-Wage Mobility in the Italian Labour Market," The Warwick Economics Research Paper Series (TWERPS) 531, University of Warwick, Department of Economics.
  9. Jeffrey M. Wooldridge, 2005. "Simple solutions to the initial conditions problem in dynamic, nonlinear panel data models with unobserved heterogeneity," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 20(1), pages 39-54.
  10. George A. Akerlof & Andrew K. Rose & Janet L. Yellen, 1988. "Job Switching and Job Satisfaction in the U.S. Labor Market," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 19(2), pages 495-594.
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Cited by:
  1. Paulo Aguiar Do Monte, 2011. "Job Dissatisfaction And Labour Turnover:Evidence From Brazil," Anais do XXXVIII Encontro Nacional de Economia [Proceedings of the 38th Brazilian Economics Meeting] 135, ANPEC - Associação Nacional dos Centros de Pósgraduação em Economia [Brazilian Association of Graduate Programs in Economics].
  2. Ricardo Pagán & Miguel Malo, 2009. "Job satisfaction and disability: lower expectations about jobs or a matter of health?," Spanish Economic Review, Springer, vol. 11(1), pages 51-74, March.
  3. Skalli, Ali & Theodossiou, Ioannis & Vasileiou, Efi, 2008. "Jobs as Lancaster goods: Facets of job satisfaction and overall job satisfaction," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 37(5), pages 1906-1920, October.
  4. Carola Grün & Wolfgang Hauser & Thomas Rhein, 2010. "Is Any Job Better than No Job? Life Satisfaction and Re-employment," Journal of Labor Research, Springer, vol. 31(3), pages 285-306, September.
  5. Bindu Chhabra, 2013. "Locus Of Control As A Moderator In The Relationship Between Job Satisfaction And Organizational Commitment: A Study Of Indian It Professionals," Organizations and Markets in Emerging Economies, Faculty of Economics, Vilnius University, vol. 4(2).
  6. B. Defloor & L. Van Ootegem & E. Verhofstadt, 2010. "A distance function approach to school-leavers’ efficiency in the school-to-work transition," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 10/682, Ghent University, Faculty of Economics and Business Administration.
  7. Heinemann, Friedrich & Hennighausen, Tanja & Moessinger, Marc-Daniel, 2011. "Intrinsic work motivation and pension reform acceptance," ZEW Discussion Papers 11-045, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  8. Nuno Crespo & Nádia Simões & José Castro Pinto, 2013. "Determinant factors of job quality in Europe," Working Papers Series 2 13-01, ISCTE-IUL, Business Research Unit (BRU-IUL).
  9. Sara Depedri & Ermanno Tortia & Maurizio Carpita, 2010. "Incentives, job satisfaction and performance: empirical evidence in italian social enterprises," Euricse Working Papers 1012, Euricse (European Research Institute on Cooperative and Social Enterprises).
  10. E. Schokkaert & E. Verhofstadt & L. Van Ootegem & -, 2009. "Measuring job quality and job satisfaction," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 09/620, Ghent University, Faculty of Economics and Business Administration.
  11. Hussain Naeem Author_Email: & Ilham Sentosa & Hadi Nejatian & Shishi Kumar Piaralal, 2011. "Job Satisfaction Of Civil Servants (An Evidence From The Republic Of Maldives)," 2nd International Conference on Business and Economic Research (2nd ICBER 2011) Proceeding 2011-256, Conference Master Resources.
  12. Grün, Carola & Hauser, Wolfgang & Rhein, Thomas, 2008. "Finding a job: Consequences for life satisfaction and interactions with job quality," IAB Discussion Paper 200824, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
  13. Pouliakas, Konstantinos & Theodossiou, Ioannis, 2005. "Socio-Economic Differences in the Satisfaction of High-Pay and Low-Pay Jobs in Europe," MPRA Paper 16733, University Library of Munich, Germany, revised 10 Aug 2009.

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