High-Pressure, High-Paying Jobs

(with Erwin Winkler and Johannes Rincke)

Work-related stress has reportedly increased over time. Using worker-level survey data, we build a measure of work pressure strongly associated with adverse health outcomes. In line with theories of compensating differentials, work pressure comes with a sizable earnings premium, even within narrowly defined occupations. As expected, we find no premium among civil servants who face strong labor market frictions. In complementary stated-choice experiments, we uncover a substantial willingness-to-pay to avoid work pressure. Our evidence is consistent with workers sorting into high- and low-pressure jobs. Differences in the prevalence and valuation of work pressure explain a substantial share of wage inequality.

CESifo Working Paper No. 10102

AEARCTR-0009559

How Much Do Workers Actually Value Working From Home?

(with Erwin Winkler and Johannes Rincke)

Working from home (WFH) has become ubiquitous around the world. Using a stated-preference experiment among German employees, we estimate workers’ valuation of WFH and its interaction with other job attributes. We show that workers are willing to give up 7.7% of their earnings for WFH. The value of WFH is significantly higher in the presence of a flexible work schedule,
suggesting that employees view WFH and schedule flexibility as complements. The willingness-to-pay for WFH steeply increases with commuting distance. WFH reduces (but does not close) the gender gap in willingness-to-pay to avoid commuting.

CESifo Working Paper No. 10073