Labor Mobility and Wages

   (879 K)

Workers' compensation insurance provides cash payments and medical benefits to workers who incur a work-related injury or illness .Many features of the workers' compensation program parallel features of proposed mandated employer-paid health insurance plans. This paper empirically examines the incidence of the workers' compensation program to infer the likely consequences of mandated health insurance proposals. In certain industries, such as trucking and carpentry, workers' compensation insurance costs are quite large, and vary tremendously within states overtime, and across states at a moment in time. This variation issued to identify the incidence of the program. Empirical analysis of two data sets suggest that changes in employers' costs of workers' compensation insurance are largely shifted to employees in the form of lower wages. In addition, higher insurance costs are found to have a negative but statistically insignificant effect on employment. The implied elasticity of labor demand from our results is about -.50.

Published:

• Mincer, Jacob and Jovanovic, Boyan. "Labor Mobility and Wages." Studies in Labor Markets, edited by Sherwin Rosen, pp. 21-63. Chicago: University of Chicago Press, 1981. ,
• Labor Mobility and Wages, Jacob Mincer, Boyan Jovanovic, in Studies in Labor Markets (1981), University of Chicago Press
  

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