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Nurses wanted. Is the job too harsh or is the wage too low?

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Author Info
Di Tommaso Maria Laura () (University of Turin)
Strom Steinar () (University of Turin)
Saether Erik Magnus

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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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Paper provided by University of Turin in its series Department of Economics Working Papers with number 200704.

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

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  1. John Creedy & Guyonne Kalb, 2005. "Discrete Hours Labour Supply Modelling: Specification, Estimation and Simulation," Department of Economics - Working Papers Series 928, The University of Melbourne. [Downloadable!]
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  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. [Downloadable!]
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  3. 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. [Downloadable!] (restricted)
  4. 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.. [Downloadable!]
  5. John K. Dagsvik & Anders Karlström, 2005. "Compensating Variation and Hicksian Choice Probabilities in Random Utility Models that are Nonlinear in Income," Review of Economic Studies, Blackwell Publishing, vol. 72(1), pages 57-76, 01. [Downloadable!] (restricted)
  6. 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. [Downloadable!] (restricted)
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  7. 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. [Downloadable!]
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  8. Kenneth Train, 2003. "Discrete Choice Methods with Simulation," Online economics textbooks, SUNY-Oswego, Department of Economics, number emetr2, March. [Downloadable!]
  9. Paul van den Noord & Terje Hagen & Tor Iversen, 1998. "The Norwegian Health Care System," OECD Economics Department Working Papers 198, OECD, Economics Department. [Downloadable!]
  10. Lanfranchi, Joseph & Ohlsson, Henry & Skalli, Ali, 2002. "Compensating wage differentials and shift work preferences," Economics Letters, Elsevier, vol. 74(3), pages 393-398, February. [Downloadable!] (restricted)
  11. Kostiuk, Peter F, 1990. "Compensating Differentials for Shift Work," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 1054-75, October. [Downloadable!] (restricted)
  12. John K. Dagsvik and Steinar Strøm, 2004. "Sectoral Labor Supply, Choice Restrictions and Functional Form," Discussion Papers 388, Research Department of Statistics Norway. [Downloadable!]
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