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Author: Ho, Cheuk Yin
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1. Ho, Cheuk Yin
Essays on Labor Economics
Ph.D. Dissertation, University of Rochester, 2013
Cohort(s): NLSY79
Publisher: ProQuest Dissertations & Theses (PQDT)
Keyword(s): Job Hazards; Modeling, Hazard/Event History/Survival/Duration; Occupations; Wage Models; Wage Theory

Permission to reprint the abstract has not been received from the publisher.

Chapter 1 estimates the compensating differential with moral hazard. I show that, in an environment of asymmetric information, the wage premium of an unpleasant job attribute not only includes the compensating differential but also the economic rent that stimulates worker effort. The wage premium is equal to the compensating differential if and only if workers are perfectly monitored. Estimates of a structural model using data from the National Longitudinal Survey of Youth find that the wage premium of risky jobs is 6.6%, which is decomposed into a compensating differential that accounts for 2.8% and an efficiency wage premium that accounts for 3.8%. Since the wage premium is interpreted as the compensating differential in a hedonic wage regression, the results show that the reduced-form estimate of the compensating differential has upward bias.
Bibliography Citation
Ho, Cheuk Yin. Essays on Labor Economics. Ph.D. Dissertation, University of Rochester, 2013.