Compensating -wage differentials for job stress

Michael T. French, Laura J. Dunlap

Research output: Contribution to journalArticle

17 Scopus citations

Abstract

Recent medical studies have demonstrated a strong relationship between mental stress and cardiac events such as myocardial infarction and stroke. In the workplace, stress once accounted for less than 5% of all occupational disease claims, but it now accounts for over 15%. Although research on the effects of mental stress is increasing, few studies offer an economic perspective. In this paper, we examine the effects of job stress on weekly wages and explore the possibility that stress commands a compensating wage differential. Our findings suggest that, ceteris paribus, a wage differential does exist between workers experiencing mental stress and their 'non-stressed' cohorts. After controlling for other demographic and occupational factors, we found a statistically significant wage premium ranging from 3 to 10% attributable to mental stress. In addition, the magnitude of the differential varies by gender.

Original languageEnglish (US)
Pages (from-to)1067-1075
Number of pages9
JournalApplied Economics
Volume30
Issue number8
DOIs
StatePublished - Jan 1 1998

ASJC Scopus subject areas

  • Economics and Econometrics

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