Compensating Wage Differentials for Mandatory Overtime
Our paper estimates the extent to which employees are compensated for an unfavorable job characteristic, being required to accept mandatory assignment of overtime, by receiving higher straight-time wages. Our estimating equations are derived from a model in which wage rates and the existence of mandatory assignment of overtime are jointly determined in the market by the interaction of employee and employer preferences. While - on average, we do not observe the existence of a compensating wage differential for mandatory overtime, we do observe the existence of such differentials for unionized workers and workers with only a few years experience at a firm. Given any estimated compensating wage differential for an unfavorable working condition, one must decide whether its magnitude is sufficiently large to allow one to conclude that the differential fully compensates workers for the disutility of being subject to the unfavorable working condition. We develop and illustrate a methodology that can be used to answer this question, at least for the case of mandatory overtime provisions and other rules that restrict employees' choice of hours.
|Date of creation:||Nov 1981|
|Date of revision:|
|Publication status:||published as Ehrenberg, Ronald G. and Paul L. Schumann. "Compensating Wage Differentials for Mandatory Overtime." Economic Inquiry, Vol. 22, No. 4, (0ctober 1984), pp. 460-478.|
|Contact details of provider:|| Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.|
Web page: http://www.nber.org
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Greg J. Duncan, 1976. "Earnings Functions and Nonpecuniary Benefits," Journal of Human Resources, University of Wisconsin Press, vol. 11(4), pages 462-483.
- John Abowd & Orley C. Ashenfelter, 1979. "Unemployment and Compensating Wage Differentials," Working Papers 500, Princeton University, Department of Economics, Industrial Relations Section..
- Kim B. Clark, 1980. "The Impact of Unionization on Productivity: A Case Study," ILR Review, Cornell University, ILR School, vol. 33(4), pages 451-469, July.
- Poirier, Dale J., 1980. "Partial observability in bivariate probit models," Journal of Econometrics, Elsevier, vol. 12(2), pages 209-217, February.
- repec:pri:indrel:dsp01df65v786d is not listed on IDEAS
- Lee, Lung-Fei, 1978. "Unionism and Wage Rates: A Simultaneous Equations Model with Qualitative and Limited Dependent Variables," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 19(2), pages 415-33, June.
- Deardorff, Alan V & Stafford, Frank P, 1976. "Compensation of Cooperating Factors," Econometrica, Econometric Society, vol. 44(4), pages 671-84, July.
- repec:fth:prinin:120 is not listed on IDEAS
- Ronald G. Ehrenberg, 1980. "Retirement System Characteristics and Compensating Wage Differentials in the Public Sector," ILR Review, Cornell University, ILR School, vol. 33(4), pages 470-483, July.
- Brown, Charles & Medoff, James, 1978. "Trade Unions in the Production Process," Journal of Political Economy, University of Chicago Press, vol. 86(3), pages 355-78, June.
- Duncan, Greg J & Stafford, Frank P, 1980. "Do Union Members Receive Compensating Wage Differentials?," American Economic Review, American Economic Association, vol. 70(3), pages 355-71, June.
When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:0805. 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: ()
If references are entirely missing, you can add them using this form.