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Title: Compensating Wage Differentials among Self-Employed Workers: Evidence from Job Satisfaction Scores
Resulting in 1 citation.
1. Kawaguchi, Daiji
Compensating Wage Differentials among Self-Employed Workers: Evidence from Job Satisfaction Scores
Working Paper No. 568, the Institute of Social and Economic Research - Osaka University, June 2002
Cohort(s): NLSY79
Publisher: Institute of Social and Economic Research (ISER), Osaka University
Keyword(s): Job Satisfaction; Job Tenure; Self-Employed Workers; Wage Differentials

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

Previous studies have found that self-employed workers with long business tenure earn less than other workers with similar characteristics. This difference in earnings can be explained by the compensating wage differential theory when self-employed jobs have attractive, non-pecuniary aspects. Using the National Longitudinal Survey of Youth 79 (NLSY79), I test whether moves in and out of self-employment are associated with changes in global job satisfaction. By looking at changes in job satisfaction for individuals over time, I overcome the difficulty of interpreting differences in subjective job satisfaction scores across individuals that cross-sectional analysis would require. Using my estimates, I calculate the monetary value of the non-pecuniary aspects of self-employment and find that the value of self-employment in terms of job satisfaction is sufficiently high enough to support the compensating differential hypothesis as an explanation for lower earnings among self-employed workers.
Bibliography Citation
Kawaguchi, Daiji. "Compensating Wage Differentials among Self-Employed Workers: Evidence from Job Satisfaction Scores." Working Paper No. 568, the Institute of Social and Economic Research - Osaka University, June 2002.