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Compensating wage differentials for job stress

Author

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  • Michael French
  • Laura Dunlap

Abstract

Recent medical studies have demonstrated a strong relationship between mental stress and cardiac events such as myocardial infarction and stroke. In the workplace, stress once accounted for less than 5% of all occupational disease claims, but it now accounts for over 15%. Although research on the effects of mental stress is increasing, few studies offer an economic perspective. In this paper, we examine the effects of job stress on weekly wages and explore the possibility that stress commands a compensating wage differential. Our findings suggest that, ceteris paribus, a wage differential does exist between workers experiencing mental stress and their 'non-stressed' cohorts. After controlling for other demographic and occupational factors, we found a statistically significant wage premium ranging from 3 to 10% attributable to mental stress. In addition, the magnitude of the differential varies by gender.

Suggested Citation

  • Michael French & Laura Dunlap, 1998. "Compensating wage differentials for job stress," Applied Economics, Taylor & Francis Journals, vol. 30(8), pages 1067-1075.
  • Handle: RePEc:taf:applec:v:30:y:1998:i:8:p:1067-1075
    DOI: 10.1080/000368498325237
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    Citations

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    Cited by:

    1. Melanie K. Jones & Paul L. Latreille & Peter J. Sloane, 2016. "Job Anxiety, Work-Related Psychological Illness and Workplace Performance," British Journal of Industrial Relations, London School of Economics, vol. 54(4), pages 742-767, December.
    2. Fernández, Rosa M. & Nordman, Christophe J., 2009. "Are there pecuniary compensations for working conditions?," Labour Economics, Elsevier, vol. 16(2), pages 194-207, April.
    3. González Álvarez, Mª Luz & Gamero-Burón, Carlos, 2013. "Coste de las visitas médicas y urgencias asociadas al estrés laboral en España/Health Care Costs Due to Job Stress in Spain," Estudios de Economía Aplicada, Estudios de Economía Aplicada, vol. 31, pages 417-444, Septiembr.
    4. repec:eme:rleczz:s0147-9121(2013)0000038005 is not listed on IDEAS
    5. Bocquier, Philippe & Nordman, Christophe J. & Vescovo, Aude, 2010. "Employment Vulnerability and Earnings in Urban West Africa," World Development, Elsevier, vol. 38(9), pages 1297-1314, September.
    6. Jones, Melanie K & Latreille, Paul L & Sloane, Peter J, 2011. "NILS Working paper no 180. Job anxiety, work-related psychological illness and workplace performance," NILS Working Papers 26078, National Institute of Labour Studies.
    7. Rees, Daniel I. & Sabia, Joseph J., 2012. "Migraine Headache and Labor Market Outcomes," IZA Discussion Papers 7034, Institute for the Study of Labor (IZA).
    8. Nikolaos Georgantzis & Efi Vasileiou, 2014. "Are Dangerous Jobs Paid Better? European Evidence," Research in Labor Economics,in: New Analyses of Worker Well-Being, volume 38, pages 163-192 Emerald Publishing Ltd.
    9. repec:dau:papers:123456789/4294 is not listed on IDEAS
    10. Ambra Poggi, 2007. "Do Satisfactory Working Conditions Contribute to Explaining Earning Differentials in Italy? A Panel Data Approach," LABOUR, CEIS, vol. 21(4-5), pages 713-733, December.
    11. Rosemary Batt & Hiroatsu Nohara & Hyunji Kwon, 2010. "Employer Strategies and Wages in New Service Activities: A Comparison of Co-ordinated and Liberal Market Economies," British Journal of Industrial Relations, London School of Economics, vol. 48(2), pages 400-435, June.
    12. Ndamsa Dickson Thomas & Baye Mendjo Francis & Epo Boniface Ngah, 2013. "Responsiveness of Private Sector Household Income to Employment Vulnerability in Cameroon," EuroEconomica, Danubius University of Galati, issue 1(32), pages 153-177, May.

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