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  4. July 2023
  5. The Value of Working Conditions in the United States and the Implications for the Structure of Wages

The Value of Working Conditions in the United States and the Implications for the Structure of Wages

  • Nicole Maestas
  • Kathleen J. Mullen
  • David Powell
  • Till von Wachter
  • Jeffrey B. Wenger
American Economic Review
vol. 113, no. 7, July 2023
(pp. 2007-47)
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Abstract

We document variation in working conditions in the United States, present estimates of how workers value these conditions, and assess the impact of working conditions on estimates of wage inequality. We conduct a series of stated-preference experiments to estimate workers' willingness to pay for a broad set of working conditions, which we validate with actual job choices. We find that working conditions vary substantially, play a significant role in job choice, and are central components of the compensation received by workers. We find that accounting for differences in preferences for working conditions often exacerbates wage differentials and intensifies measures of wage inequality.

Citation

Maestas, Nicole, Kathleen J. Mullen, David Powell, Till von Wachter, and Jeffrey B. Wenger. 2023. "The Value of Working Conditions in the United States and the Implications for the Structure of Wages." American Economic Review, 113 (7): 2007-47. DOI: 10.1257/aer.20190846

Additional Materials

JEL Classification

  • J22 Time Allocation and Labor Supply
  • J28 Safety; Job Satisfaction; Related Public Policy
  • J31 Wage Level and Structure; Wage Differentials
  • J81 Labor Standards: Working Conditions