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The Economics of Vocation or Why is a Badly Paid Nurse a Good Nurse?

Abstract

Given the longstanding shortage of nurses in many jurisdictions, why couldn’t nursing wages be raised to attract more people into the profession? We tell a story in which the status of nursing as a ‘vocation’ implies that increasing wages reduces the average quality of applicants attracted. The underlying mechanism accords with the notion that increasing wages might attract the ‘wrong sort’ of people into the profession and highlights an (in)e?ciency wage mechanism, particular to vocations, which makes wages sticky upwards. The analysis has implications for job design in vocation-based sectors such as nursing and teaching.

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Paper provided by Department of Economics, Royal Holloway University of London in its series Royal Holloway, University of London: Discussion Papers in Economics with number 03/4.

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Length: 11 pages
Date of creation: Dec 2003
Date of revision: Dec 2003
Handle: RePEc:hol:holodi:0304
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  1. Francois, Patrick, 2000. "'Public service motivation' as an argument for government provision," Journal of Public Economics, Elsevier, vol. 78(3), pages 275-299, November.
  2. Yellen, Janet L, 1984. "Efficiency Wage Models of Unemployment," American Economic Review, American Economic Association, vol. 74(2), pages 200-205, May.
  3. Summers, Lawrence H, 1988. "Relative Wages, Efficiency Wages, and Keynesian Unemployment," American Economic Review, American Economic Association, vol. 78(2), pages 383-388, May.
  4. Turnipseed, David L., 2002. "Are good soldiers good?: Exploring the link between organization citizenship behavior and personal ethics," Journal of Business Research, Elsevier, vol. 55(1), pages 1-15, January.
  5. Matthew Rabin, 1998. "Psychology and Economics," Journal of Economic Literature, American Economic Association, vol. 36(1), pages 11-46, March.
  6. Kreps, David M, 1997. "Intrinsic Motivation and Extrinsic Incentives," American Economic Review, American Economic Association, vol. 87(2), pages 359-364, May.
  7. Julie Nelson, 1999. "Of Markets And Martyrs: Is It OK To Pay Well For Care?," Feminist Economics, Taylor & Francis Journals, vol. 5(3), pages 43-59.
  8. Shapiro, Carl & Stiglitz, Joseph E, 1984. "Equilibrium Unemployment as a Worker Discipline Device," American Economic Review, American Economic Association, vol. 74(3), pages 433-444, June.
  9. Frey, Bruno S., 1993. "Shirking or work morale? : The impact of regulating," European Economic Review, Elsevier, vol. 37(8), pages 1523-1532, December.
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