Estimating British workers' demand for safety

Xiangdong WEI

    Research output: Journal Publications › Journal Article (refereed)

    4 Citations (Scopus)

    Abstract

    This paper estimates workers' demand function for job safety using the British General Household Survey data. The estimation employs Rosen's two-stage procedure. The main difference between our study and those done in the past is that we estimate hedonic price equations with data sets from two labour markets. Our approach overcomes the usual identification problems associated with the application of Rosen's method. The estimation shows that there is a significant wage compensation for job risk in the UK. The willingness-to-pay for a 1/100 000 decrease of annual job fatal accident rate from our estimated workers' demand function is about £6 in 1973 prices. The estimation of a demand function for safety also enables the derivation of workers' willingness-to-pay for non-marginal change of job risk, and this can be used for cost-benefit analysis on projects involving such non-marginal changes.
    Original languageEnglish
    Pages (from-to)1265-1271
    Number of pages7
    JournalApplied Economics
    Volume31
    Issue number10
    DOIs
    Publication statusPublished - 1 Jan 1999

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    Safety
    Workers
    Demand function
    Willingness-to-pay
    Wages
    Accidents
    Identification problem
    Survey data
    Cost-benefit analysis
    Hedonic prices
    Labour market
    Household survey

    Cite this

    WEI, Xiangdong. / Estimating British workers' demand for safety. In: Applied Economics. 1999 ; Vol. 31, No. 10. pp. 1265-1271.
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    WEI, X 1999, 'Estimating British workers' demand for safety', Applied Economics, vol. 31, no. 10, pp. 1265-1271. https://doi.org/10.1080/000368499323472

    Estimating British workers' demand for safety. / WEI, Xiangdong.

    In: Applied Economics, Vol. 31, No. 10, 01.01.1999, p. 1265-1271.

    Research output: Journal Publications › Journal Article (refereed)

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    AB - This paper estimates workers' demand function for job safety using the British General Household Survey data. The estimation employs Rosen's two-stage procedure. The main difference between our study and those done in the past is that we estimate hedonic price equations with data sets from two labour markets. Our approach overcomes the usual identification problems associated with the application of Rosen's method. The estimation shows that there is a significant wage compensation for job risk in the UK. The willingness-to-pay for a 1/100 000 decrease of annual job fatal accident rate from our estimated workers' demand function is about £6 in 1973 prices. The estimation of a demand function for safety also enables the derivation of workers' willingness-to-pay for non-marginal change of job risk, and this can be used for cost-benefit analysis on projects involving such non-marginal changes.

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    WEI X. Estimating British workers' demand for safety. Applied Economics. 1999 Jan 1;31(10):1265-1271. https://doi.org/10.1080/000368499323472

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