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The Willingness to Pay for Job Amenities: Evidence from Mothers' Return to Work

  • Christina Felfe

This study is the first to estimate mothers’ marginal willingness to pay (MWP) for job amenities directly. Its identification strategy relies on German maternity leave length. The key aspect of the maternal leave framework is that mothers can decide whether and when to return to their guaranteed job. Thus, in contrast to previous studies that analyze the job search of employed workers, this framework allows us to overcome the limitation of not observing the wage/amenity offer process. A theoretical model of the leave length decision is derived from a random utility approach. Using data from the German Socio-Economic Panel and the Qualification and Career Survey, this model is estimated by a discrete duration method. The MWP for amenities can be inferred through the estimated elasticities of the leave length with respect to the amenities and the wage. The results provide evidence that mothers are willing to sacrifice a significant fraction of their wage to reduce hazards (22%) and to enjoy a flexible working schedule (36-56%).

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File URL: http://www.cesifo-group.de/portal/page/portal/DocBase_Content/WP/WP-CESifo_Working_Papers/wp-cesifo-2009/wp-cesifo-2009-08/cesifo1_wp2743.pdf
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Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 2743.

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Date of creation: 2009
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Handle: RePEc:ces:ceswps:_2743
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  1. Timothy J. Gronberg & W. Robert Reed, 1994. "Estimating Workers' Marginal Willingness to Pay for Job Attributes Using Duration Data," Journal of Human Resources, University of Wisconsin Press, vol. 29(3), pages 911-931.
  2. Stéphane Bonhomme & Grégory Jolivet, 2005. "The Pervasive Absence of Compensating Differentials," Working Papers 2005-28, Centre de Recherche en Economie et Statistique.
  3. Thomas DeLeire & Helen Levy, 2004. "Worker Sorting and the Risk of Death on the Job," Journal of Labor Economics, University of Chicago Press, vol. 22(4), pages 925-954, October.
  4. Hwang, Hae-shin & Mortensen, Dale T & Reed, W Robert, 1998. "Hedonic Wages and Labor Market Search," Journal of Labor Economics, University of Chicago Press, vol. 16(4), pages 815-47, October.
  5. Bruce D. Meyer, 1988. "Unemployment Insurance And Unemployment Spells," NBER Working Papers 2546, National Bureau of Economic Research, Inc.
  6. Han, Aaron & Hausman, Jerry A, 1990. "Flexible Parametric Estimation of Duration and Competing Risk Models," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 5(1), pages 1-28, January-M.
  7. Bratti, Massimiliano & Del Bono, Emilia & Vuri, Daniela, 2004. "New Mothers' Labour Force Participation in Italy: The Role of Job Characteristics," IZA Discussion Papers 1111, Institute for the Study of Labor (IZA).
  8. Ernesto Villanueva, 2007. "Estimating Compensating Wage Differentials Using Voluntary Job Changes: Evidence from Germany," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 60(4), pages 544-561, July.
  9. Weber, Andrea Maria & Lauer, Charlotte, 2003. "Employment of Mothers After Childbirth: French-German Comparison," ZEW Discussion Papers 03-50, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  10. Christina Felfe, 2008. "The Child Penalty - What about Job Amenities?," University of St. Gallen Department of Economics working paper series 2008 2008-22, Department of Economics, University of St. Gallen.
  11. Jan Ondrich & C. Spiess & Qing Yang & Gert Wagner, 2003. "The Liberalization of Maternity Leave Policy and the Return to Work after Childbirth in Germany," Review of Economics of the Household, Springer, vol. 1(1), pages 77-110, January.
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