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Wages and Working Conditions

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  • Henry Saffer

Abstract

This paper presents another extension of the approach initiated by Brown. As in Brown's work, the wage change specification is used to control for bias due to omitted ability data. Then, as in Duncan and Hoimlund's study, working conditions are measured using subjective self?reported data. However, in this paper, working conditions are measured by a single comprehensive variable. This approach eliminates omitted working conditions as a source of bias. The working conditions measure is then treated as an unobserved variable which limits measurement error to an unknown scale factor. The model is estimated using a technique derived by memiya (1978).

Suggested Citation

  • Henry Saffer, 1984. "Wages and Working Conditions," NBER Working Papers 1418, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:1418
    Note: EH
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    1. Muthen, Bengt, 1983. "Latent variable structural equation modeling with categorical data," Journal of Econometrics, Elsevier, vol. 22(1-2), pages 43-65.
    2. Greg J. Duncan, 1976. "Earnings Functions and Nonpecuniary Benefits," Journal of Human Resources, University of Wisconsin Press, vol. 11(4), pages 462-483.
    3. Lee, Lung-Fei, 1982. "Health and Wage: A Simultaneous Equation Model with Multiple Discrete Indicators," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 23(1), pages 199-221, February.
    4. Charles Brown, 1980. "Equalizing Differences in the Labor Market," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 94(1), pages 113-134.
    5. Heckman, James J, 1978. "Dummy Endogenous Variables in a Simultaneous Equation System," Econometrica, Econometric Society, vol. 46(4), pages 931-959, July.
    6. Freeman, Richard B, 1978. "Job Satisfaction as an Economic Variable," American Economic Review, American Economic Association, vol. 68(2), pages 135-141, May.
    7. Amemiya, Takeshi, 1978. "The Estimation of a Simultaneous Equation Generalized Probit Model," Econometrica, Econometric Society, vol. 46(5), pages 1193-1205, September.
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