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Testing Rent Sharing Using Individualized Measures of Rent: Evidence from Domestic Helpers

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  • Suen, Wing

Abstract

The market for resident domestic helpers offers a rare opportunity where the surplus from employment relationship can be quantitatively measured for each individual employee. Using the difference between employer's cost of time and employee's wage as a measure of rent, it is found that wages for domestic helpers are positively related to rent. However the apparent sharing of rent is better explained by matching than by efficiency wage models. Rent sharing is observed even in households where monitoring or turnover costs are low. Rent sharing is not observed among newly arrived foreign domestic helpers, whose ability remains to be revealed. Copyright 2000 by Oxford University Press.

Suggested Citation

  • Suen, Wing, 2000. "Testing Rent Sharing Using Individualized Measures of Rent: Evidence from Domestic Helpers," Economic Inquiry, Western Economic Association International, vol. 38(3), pages 470-486, July.
    • Handle: RePEc:oup:ecinqu:v:38:y:2000:i:3:p:470-86
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    Cited by:

    1. Sam Hak Kan Tang & Linda Chor Wing Yung, 2016. "Maids or mentors? The effects of live-in foreign domestic workers on children's educational achievement in Hong Kong," Education Economics, Taylor & Francis Journals, vol. 24(1), pages 96-120, February.
    2. Kuhn, Johan Moritz, 2007. "My Pay is Too Bad (I Quit). Your Pay is Too Good (You're Fired)," Working Papers 07-5, University of Aarhus, Aarhus School of Business, Department of Economics.

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