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Preferences, Comparative Advantage, and Compensating Wage Differentials for Job Routinization

  • Climent Quintana‐Domeque

I attempt to explain why compensating differentials for job disamenities are difficult to observe. I focus on the match between workers’ preferences for routine jobs and the variability in tasks associated with the job. Using data from the Wisconsin Longitudinal Study, I find that mismatched workers report lower job satisfaction and earn lower wages. Both male and female workers in routinized jobs earn, on average, 12% less than their counterparts in non-routinized jobs. Once preferences and mismatch are accounted for, this difference decreases to 8% for men and 5% for women. Accounting for mismatch is important when analyzing compensating differentials.

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Article provided by Department of Economics, University of Oxford in its journal Oxford Bulletin of Economics and Statistics.

Volume (Year): 73 (2011)
Issue (Month): 2 (04)
Pages: 207-229

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Handle: RePEc:bla:obuest:v:73:y:2011:i:2:p:207-229
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