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Did Workers Pay for the Passage of Workers' Compensation Laws?

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  • Price V. Fishback
  • Shawn Everett Kantor

Abstract

Market responses to legislative reforms often mitigate the expected gains that reformers promise in legislation. Contemporaries hailed workers' compensation as a boon to workers because it raised the amount of post-accident compensation paid to injured workers. Despite the large gains to workers, employers often supported the legislation. Analysis of several wage samples from the early 1900s shows that employers were able to pass a significant part of the added costs of higher post-accident compensation onto some workers in the form of reductions in wages. The size of the wage offsets, however, were smaller for union workers.

Suggested Citation

  • Price V. Fishback & Shawn Everett Kantor, 1994. "Did Workers Pay for the Passage of Workers' Compensation Laws?," NBER Working Papers 4947, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:4947 Note: DAE LS
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    References listed on IDEAS

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    Cited by:

    1. Jonathan Gruber & Aaron Yelowitz, 1999. "Public Health Insurance and Private Savings," Journal of Political Economy, University of Chicago Press, vol. 107(6), pages 1249-1274, December.
    2. Claudia Goldin, 1994. "Labor Markets in the Twentieth Century," NBER Historical Working Papers 0058, National Bureau of Economic Research, Inc.
    3. Hilary W. Hoynes & Diane Whitmore Schanzenbach, 2009. "Consumption Responses to In-Kind Transfers: Evidence from the Introduction of the Food Stamp Program," American Economic Journal: Applied Economics, American Economic Association, vol. 1(4), pages 109-139, October.
    4. Fishback, Price V & Kantor, Shawn Everett, 1998. "The Adoption of Workers' Compensation in the United States, 1900-1930," Journal of Law and Economics, University of Chicago Press, vol. 41(2), pages 305-341, October.
    5. White, Eugene N., 1996. "The past and future of economic history in economics," The Quarterly Review of Economics and Finance, Elsevier, vol. 36(Supplemen), pages 61-72.
    6. Jonathan Gruber, 1998. "Health Insurance and the Labor Market," NBER Working Papers 6762, National Bureau of Economic Research, Inc.
    7. Kelly D. Edmiston, 2006. "Workers' Compensation and State Employment Growth," Journal of Regional Science, Wiley Blackwell, vol. 46(1), pages 121-145.
    8. Price V. Fishback, 2006. "The Irony of Reform. Did Large Employers Subvert Workplace Safety Reform, 1869 to 1930?," NBER Chapters,in: Corruption and Reform: Lessons from America's Economic History, pages 285-318 National Bureau of Economic Research, Inc.
    9. Joanna N. Lahey, 2012. "The efficiency of a group‐specific mandated benefit revisited: The effect of infertility mandates," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 31(1), pages 63-92, December.
    10. Murray, John E. & Nilsson, Lars, 2007. "Accident risk compensation in late imperial Austria: Wage differentials and social insurance," Explorations in Economic History, Elsevier, vol. 44(4), pages 568-587, October.
    11. Fishback, Price V. & Kantor, Shawn Everett, 1998. "The Political Economy of Workers' Compensation Benefit Levels, 1910-1930," Explorations in Economic History, Elsevier, vol. 35(2), pages 109-139, April.
    12. Samuel K. ALLEN, 2015. "Struggle for Regulatory Power between States and the US Federal Government: The Case of Workers’ Compensation Insurance 1930-2000," Journal of Economics and Political Economy, KSP Journals, vol. 2(3), pages 351-373, September.
    13. Price V. Fishback & Shawn Everett Kantor, 1994. "Insurance Rationing and the Origins of Workers' Compensation," NBER Working Papers 4943, National Bureau of Economic Research, Inc.
    14. Robert L. Clark & Lee A. Craig & John Sabelhaus, 2011. "State and Local Retirement Plans in the United States," Books, Edward Elgar Publishing, number 13685, April.
    15. Moriguchi, Chiaki, 2003. "Implicit Contracts, the Great Depression, and Institutional Change: A Comparative Analysis of U.S. and Japanese Employment Relations, 1920 1940," The Journal of Economic History, Cambridge University Press, vol. 63(03), pages 625-665, September.
    16. Jonathan Gruber & Julie Berry Cullen, 1996. "Spousal Labor Supply as Insurance: Does Unemployment Insurance Crowd Outthe Added Worker Effect?," NBER Working Papers 5608, National Bureau of Economic Research, Inc.
    17. Addison, John T., 2006. "Politico-Economic Causes of Labor Regulation in the United States: Rent Seeking, Alliances, Raising Rivals' Costs (Even Lowering One's Own?), and Interjurisdictional Competition," IZA Discussion Papers 2381, Institute for the Study of Labor (IZA).
    18. Emery, J.C. Herbert, 2010. ""Un-American" or unnecessary? America's rejection of compulsory government health insurance in the Progressive Era," Explorations in Economic History, Elsevier, vol. 47(1), pages 68-81, January.
    19. Anthony Marino, 2015. "Work environment and moral hazard," Journal of Regulatory Economics, Springer, vol. 48(1), pages 53-73, August.
    20. Katherine Baicker & Helen Levy, 2008. "Employer Health Insurance Mandates and the Risk of Unemployment," Risk Management and Insurance Review, American Risk and Insurance Association, vol. 11(1), pages 109-132, March.
    21. Robert L. Clark & Melinda Sandler Morrill, 2010. "Retiree Health Plans in the Public Sector," Books, Edward Elgar Publishing, number 13688, April.
    22. Robert C. Bird & John D. Knopf, 2009. "Do Wrongful-Discharge Laws Impair Firm Performance?," Journal of Law and Economics, University of Chicago Press, vol. 52(2), pages 197-222, May.

    More about this item

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • N32 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - U.S.; Canada: 1913-

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