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Nurses Wanted. Is the Job Too Harsh or is the Wage Too Low?

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  • Di Tommaso Maria Laura

    ()

  • Strom Steinar

    ()

  • Saether Erik Magnus

    ()
    (University of Turin)

Abstract

When entering the job market, nurses choose among different kínd of jobs. Each of these jobs is characterized by wage, sector (primary care or hospital) and shift (daytime work or shift). This paper estimates a multisector-job-type random utílity model of labor supply on data for Norwegian registered nurses in 2000. The empirical model implies that labor supply is rather inelastic; 10 percent increase in the wage rates for all nurses is estímaled to vield 3.3 percent íncrease in overall labor supply. This modest response shadows for much stronger inter job-type responses. Our approach differs from previous studíes in two ways: First, to our knowledge,it ís thefirst tíme that a model of labour supply for nurses ís estímated takíng explícíty ínto account the choices that RN's have regarding work place and type of job. Second, it differs from previous studies with respect to the measurement of the compensations for different types of work. So far, it has been focused on wage differentíals. But there are more attributes of a job than the wage. Based on the estimated random utílíty model we therefore calculate the expected value of compensatíon that makes a utílíty maxìmìzìng agent indifferent between types of jobs, here behween shift work and daytìme work. It turns out that Nondegian nurses working shifis may be willing to work shift relative to daytime work for lower wage than the current one

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Bibliographic Info

Paper provided by University of Turin in its series Department of Economics and Statistics Cognetti de Martiis. Working Papers with number 200704.

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Length: 36 pages
Date of creation: Apr 2007
Date of revision:
Handle: RePEc:uto:dipeco:200704

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References

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  1. Lanfranchi, Joseph & Ohlsson, Henry & Skalli, Ali, 2002. "Compensating wage differentials and shift work preferences," Economics Letters, Elsevier, vol. 74(3), pages 393-398, February.
  2. Dagsvik, John K. & Locatelli, Marilena & Strøm, Steinar, 2006. "Simulating labor supply behavior when workers have preferences for job opportunities and face nonlinear budget constraints," Memorandum 20/2006, Oslo University, Department of Economics.
  3. Shields, Michael & Ward-Warmedinger, Melanie, 2001. "Improving Nurse Retention in the National Health Service in England: The Impact of Job Satisfaction on Intentions to Quit," CEPR Discussion Papers 2806, C.E.P.R. Discussion Papers.
  4. John K. Dagsvik & Steinar Strøm, 2004. "Sectoral Labor Supply, Choice Restrictions and Functional Form," Discussion Papers 388, Research Department of Statistics Norway.
  5. Tor Helge Holmås, 2002. "Keeping nurses at work: a duration analysis," Health Economics, John Wiley & Sons, Ltd., vol. 11(6), pages 493-503.
  6. Jan Erik Askildsen & Badi H. Baltagi & Tor Helge Holmås, 2002. "Will Increased Wages Reduce Shortage of Nurses? A Panel Data Analysis of Nurses' Labor Supply," 10th International Conference on Panel Data, Berlin, July 5-6, 2002 D1-2, International Conferences on Panel Data.
  7. Phillips, V. L., 1995. "Nurses' labor supply: Participation, hours of work, and discontinuities in the supply function," Journal of Health Economics, Elsevier, vol. 14(5), pages 567-582, December.
  8. Train,Kenneth E., 2009. "Discrete Choice Methods with Simulation," Cambridge Books, Cambridge University Press, number 9780521747387.
  9. Paul van den Noord & Terje Hagen & Tor Iversen, 1998. "The Norwegian Health Care System," OECD Economics Department Working Papers 198, OECD Publishing.
  10. Altonji, Joseph G & Paxson, Christina H, 1988. "Labor Supply Preferences, Hours Constraints, and Hours-Wage Trade-Offs," Journal of Labor Economics, University of Chicago Press, vol. 6(2), pages 254-76, April.
  11. John Creedy & Guyonne Kalb, 2003. "Discrete Hours Labour Supply Modelling: Specification, Estimation and Simulation," Melbourne Institute Working Paper Series wp2003n16, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
  12. Kostiuk, Peter F, 1990. "Compensating Differentials for Shift Work," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 1054-75, October.
  13. John K. Dagsvik & Anders Karlstr�m, 2005. "Compensating Variation and Hicksian Choice Probabilities in Random Utility Models that are Nonlinear in Income," Review of Economic Studies, Oxford University Press, vol. 72(1), pages 57-76.
  14. Elliott, Robert F. & Ma, Ada H.Y. & Scott, Anthony & Bell, David & Roberts, Elizabeth, 2007. "Geographically differentiated pay in the labour market for nurses," Journal of Health Economics, Elsevier, vol. 26(1), pages 190-212, January.
  15. Roed,K. & Strom,S., 1999. "Progressive taxes and the labour market : is the trade-off between equality and efficiency inevitable?," Memorandum 19/1999, Oslo University, Department of Economics.
  16. Aaberge, Rolf & Colombino, Ugo & Strom, Steinar, 1999. "Labour Supply in Italy: An Empirical Analysis of Joint Household Decisions, with Taxes and Quantity Constraints," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 14(4), pages 403-22, July-Aug..
  17. Michael A. Shields, 2004. "Addressing nurse shortages: what can policy makers learn from the econometric evidence on nurse labour supply?," Economic Journal, Royal Economic Society, vol. 114(499), pages F464-F498, November.
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Cited by:
  1. Hanel, Barbara & Kalb, Guyonne & Scott, Anthony, 2014. "Nurses’ labour supply elasticities: The importance of accounting for extensive margins," Journal of Health Economics, Elsevier, vol. 33(C), pages 94-112.

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