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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%).

Suggested Citation

  • Christina Felfe, 2009. "The Willingness to Pay for Job Amenities: Evidence from Mothers' Return to Work," CESifo Working Paper Series 2743, CESifo Group Munich.
  • Handle: RePEc:ces:ceswps:_2743

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    References listed on IDEAS

    1. Meyer, Bruce D, 1990. "Unemployment Insurance and Unemployment Spells," Econometrica, Econometric Society, vol. 58(4), pages 757-782, July.
    2. StÈphane Bonhomme & GrÈgory Jolivet, 2009. "The pervasive absence of compensating differentials," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 24(5), pages 763-795.
    3. Massimiliano Bratti & Emilia Del Bono & Daniela Vuri, 2005. "New Mothers' Labour Force Participation in Italy: The Role of Job Characteristics," LABOUR, CEIS, vol. 19(s1), pages 79-121, December.
    4. 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.
    5. Ch. LAUER & A.M. WEBER, 2003. "Employment of Mothers after Childbirth : A French-German Comparison," Working Papers ERMES 0309, ERMES, University Paris 2.
    6. 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 815-847, October.
    7. 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.
    8. 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.
    9. 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.
    10. 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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    Cited by:

    1. Yu-Fu Chen & Michael Funke, 2010. "Booms, Recessions And Financial Turmoil: A Fresh Look At Investment Decisions Under Cyclical Uncertainty," Scottish Journal of Political Economy, Scottish Economic Society, vol. 57(s1), pages 290-317, July.
    2. Schnabel Claus, 2016. "United, Yet Apart? A Note on Persistent Labour Market Differences between Western and Eastern Germany," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 236(2), pages 157-179, March.
    3. Gafni Dalit & Siniver Erez, 2015. "Is There a Motherhood Wage Penalty for Highly Skilled Women?," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 15(3), pages 1353-1380, July.
    4. Stockton, Isabel & Bergemann, Annette & Brunow, Stephan, 2016. "There And Back Again: Women's Marginal Commuting Costs," Annual Conference 2016 (Augsburg): Demographic Change 145919, Verein für Socialpolitik / German Economic Association.

    More about this item


    marginal willingness to pay; maternal labor supply; discrete duration models;

    JEL classification:

    • J22 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Time Allocation and Labor Supply
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods


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