IDEAS home Printed from
   My bibliography  Save this paper

How amenities affect job and wage choices over the life cycle


  • Ed Nosal
  • Peter Rupert


The current wage at a job may not fully reflect the "value" of that job. For example, a job with a low starting wage may be preferred to one with a high starting wage if the growth rate of wages is higher in the former than in the latter. In fact, differences in wage growth can potentially explain why a worker might want to quit a high-paying job for one with a lower starting wage. Job amenities are another important factor that not only influences the value of a job but also provides an independent rationale for why workers change jobs. Including a job's amenities as part of its "value" can also generate a move from high-paying to low-paying jobs (or vice versa) as part of an optimal consumption plan over the life cycle. Both the direction of movement and the timing of a job change depend critically on the relationship between a worker's rate of time preference and the market interest rate.

Suggested Citation

  • Ed Nosal & Peter Rupert, 2003. "How amenities affect job and wage choices over the life cycle," Working Paper 0302, Federal Reserve Bank of Cleveland.
  • Handle: RePEc:fip:fedcwp:0302

    Download full text from publisher

    File URL:
    File Function: Full text
    Download Restriction: no

    Other versions of this item:

    References listed on IDEAS

    1. Matthew S. Dey & Christopher J. Flinn, 2005. "An Equilibrium Model of Health Insurance Provision and Wage Determination," Econometrica, Econometric Society, vol. 73(2), pages 571-627, March.
    2. 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.
    3. Altonji, Joseph G & Paxson, Christina H, 1988. "Labor Supply Preferences, Hours Constraints, and Hours-Wage Trade-Offs," Journal of Labor Economics, University of Chicago Press, vol. 6(2), pages 254-276, April.
    Full references (including those not matched with items on IDEAS)


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Christine Braun & Charlie Nusbaum & Peter Rupert, 2017. "Dual Job Search and Migration," 2017 Meeting Papers 789, Society for Economic Dynamics.
    2. Krusell, Per & Mukoyama, Toshihiko & Rogerson, Richard & Sahin, Aysegül, 2008. "Aggregate implications of indivisible labor, incomplete markets, and labor market frictions," Journal of Monetary Economics, Elsevier, vol. 55(5), pages 961-979, July.
    3. Kristina Nyström & Gulzat Zhetibaeva Elvung, 2015. "New Firms as Employers: The Wage Penalty for Voluntary and Involuntary Job Switchers," LABOUR, CEIS, vol. 29(4), pages 348-366, December.
    4. Lars Ljungqvist & Thomas J. Sargent, 2007. "Do Taxes Explain European Employment? Indivisible Labor, Human Capital, Lotteries, and Savings," NBER Chapters,in: NBER Macroeconomics Annual 2006, Volume 21, pages 181-246 National Bureau of Economic Research, Inc.

    More about this item


    Job satisfaction ; Wages ; Employment (Economic theory);

    JEL classification:

    • J2 - Labor and Demographic Economics - - Demand and Supply of Labor
    • J6 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers

    NEP fields

    This paper has been announced in the following NEP Reports:


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:fip:fedcwp:0302. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (4D Library). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.