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Nursing Wages and the Value of Educational Credentials


  • Stephen T. Mennemeyer
  • Gary Gaumer


The evidence on nurses' wage rates is examined to determine whether higher credentials command a premium in the marketplace. Also examined are private rates of return to determine if higher nursing education is a worthwhile investment for individuals. Our findings are that, after taking into account experience and job requirements, employers pay only a modest premium for enhanced educational credentials leading to licensure for basic nursing practice. A more substantial premium is paid to a small segment of the nursing profession which holds the master's degree. These findings confirm other studies that show only subtle differences among associate, diploma, and baccalaureate nurses. We conclude that neither employers nor a large segment of the nursing profession would benefit from recent proposals to require that all nurses obtain the baccalaureate degree.

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  • Stephen T. Mennemeyer & Gary Gaumer, 1983. "Nursing Wages and the Value of Educational Credentials," Journal of Human Resources, University of Wisconsin Press, vol. 18(1), pages 32-48.
  • Handle: RePEc:uwp:jhriss:v:18:y:1983:i:1:p:32-48

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    References listed on IDEAS

    1. Moore, Thomas Gale, 1971. "The Effect of Minimum Wages on Teenage Unemployment Rates," Journal of Political Economy, University of Chicago Press, vol. 79(4), pages 897-902, July-Aug..
    2. Edward M. Gramlich, 1976. "Impact of Minimum Wages on Other Wages, Employment, and Family Incomes," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 7(2), pages 409-462.
    3. Mincer, Jacob, 1976. "Unemployment Effects of Minimum Wages," Journal of Political Economy, University of Chicago Press, vol. 84(4), pages 87-104, August.
    4. Hamermesh, Daniel S, 1982. "Minimum Wages and the Demand for Labor," Economic Inquiry, Western Economic Association International, vol. 20(3), pages 365-380, July.
    5. Brown, Charles & Gilroy, Curtis & Kohen, Andrew, 1982. "The Effect of the Minimum Wage on Employment and Unemployment," Journal of Economic Literature, American Economic Association, vol. 20(2), pages 487-528, June.
    6. Betsey, Charles L & Dunson, Bruce H, 1981. "Federal Minimum Wage Laws and the Employment of Minority Youth," American Economic Review, American Economic Association, vol. 71(2), pages 379-384, May.
    7. Ragan, James F, Jr, 1977. "Minimum Wages and the Youth Labor Market," The Review of Economics and Statistics, MIT Press, vol. 59(2), pages 129-136, May.
    8. Adie, Douglas K, 1973. "Teen-Age Unemployment and Real Federal Minimum Wages," Journal of Political Economy, University of Chicago Press, vol. 81(2), pages 435-441, Part I, M.
    9. John F. Boschen & Herschel I. Grossman, 1981. "The Federal Minimum Wage, Inflation, and Employment," NBER Working Papers 0652, National Bureau of Economic Research, Inc.
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    Cited by:

    1. Jones, Cheryl Bland & Gates, Michael, 2004. "Gender-based wage differentials in a predominantly female profession: observations from nursing," Economics of Education Review, Elsevier, vol. 23(6), pages 615-631, December.
    2. Spetz, Joanne, 2002. "The value of education in a licensed profession: the choice of associate or baccalaureate degrees in nursing," Economics of Education Review, Elsevier, vol. 21(1), pages 73-85, February.
    3. Botelho, Anabela & Bland Jones, Cheryl & Kiker, B. F., 1998. "Nursing wages and educational credentials: the role of work experience and selectivity bias," Economics of Education Review, Elsevier, vol. 17(3), pages 297-306, June.
    4. Hirsch, Barry T. & Schumacher, Edward J., 1995. "Monopsony power and relative wages in the labor market for nurses," Journal of Health Economics, Elsevier, vol. 14(4), pages 443-476, October.
    5. Michael Dueker & Ada Jacox & David Kalist & Stephen Spurr, 2005. "The Practice Boundaries of Advanced Practice Nurses: An Economic and Legal Analysis," Journal of Regulatory Economics, Springer, vol. 27(3), pages 309-330, January.
    6. repec:ebl:ecbull:v:9:y:2008:i:23:p:1-14 is not listed on IDEAS
    7. Surrey Walton & Philip Graves & Robert Sexton, 2005. "New Entry and the Rate of Return to Education: The Case of Registered Nurses," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 33(3), pages 325-336, September.
    8. Coombs, Christopher & Cebula, Richard, 2009. "Are there rewards for language skills? Evidence from the earnings of registered nurses," MPRA Paper 49646, University Library of Munich, Germany.

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