We investigate the effect of employer-provided health insurance on job mobility rates and economic welfare using a search, matching, and bargaining framework. In our model, health insurance coverage decisions are made in a cooperative manner that recognizes the productivity effects of health insurance as well as its nonpecuniary value to the employee. The resulting equilibrium is one in which not all employment matches are covered by health insurance, wages at jobs providing health insurance are larger (in a stochastic sense) than those at jobs without health insurance, and workers at jobs with health insurance are less likely to leave those jobs, even after conditioning on the wage rate. We estimate the model using the 1996 panel of the Survey of Income and Program Participation, and find that the employer-provided health insurance system does not lead to any serious inefficiencies in mobility decisions. Copyright The Econometric Society 2005.

a b s t r a c tHealth insurance in the United States is typically acquired through an employer-sponsored program. Often employees offered employer-provided health insurance have the option to extend coverage to their spouse and dependents. We investigate the implications of the ''publicness'' of health insurance coverage for the labor market careers of spouses. The theoretical innovations in the paper are to extend the standard partial-partial equilibrium labor market search model to a multiple searcher setting with the inclusion of multi-attribute job offers, with some of the attributes treated as public goods within the household. The model is estimated using data from the Survey of Income and Program Participation (SIPP) using a Method of Simulated Moments (MSM) estimator. We demonstrate how previous estimates of the marginal willingness to pay (MWP) for health insurance based on cross-sectional linear regression estimators may be seriously biased due to the presence of dynamic selection effects and misspecification of the decision-making unit.Published by Elsevier B.V. Executive summaryAlthough health care costs consume about one-seventh of the Gross Domestic Product of the US, and even as health indicators of the US population significantly trail those of many other developed countries, the US has not moved to implement any sweeping changes in health care policy. In part, this reflects the sheer magnitude of the task, and, in part, the uncertainty regarding the costs and benefits of universal, possibly one-payer, health care coverage.Most policy analysis has centered on the potential cost-savings aspects of revamping the system of providing health care. Less well understood is the valuation of health insurance coverage (C. Flinn). by population members. Social science research has not been terribly helpful in pinning down the nature and size of the benefits that arise from health insurance coverage. We follow the standard ''revealed preference'' method of imputing the valuation of health insurance coverage by households. Since most coverage is provided by employers, a natural way to proceed is to look at the differences in the wages paid to otherwise identical workers covered by health insurance and those who are not. This difference in wages is taken to reflect the marginal willingness to pay for health (MWP) insurance. The empirical literature in economics is replete with estimates of this quantity.We provide a new method for estimating and interpreting the households' implicit valuation of health insurance coverage that utilizes a dynamic framework in which both spouses search in the labor market, job offers are differentiated by the wage rate and the presence or absence of health insurance coverage, and labor market decisions are made so as to maximize long-run household welfare. The utility that the household receives at any moment in time includes a preference weight attached to the presence of health insurance coverage. Our model estimates make clear that the usual method of imputing MWP, from cross-s...

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in EconStor may ABSTRACTWe estimate the effects of manufacturers' use of employment services-comprised primarily of temporary help and professional employer organizations-on measured employment and labor productivity in manufacturing between 1989 and 2004. A major contribution of the paper is the construction of panel data on employment by occupation and industry from the Occupational Employment Statistics program. We use these data to document the dramatic rise of production and other manual occupations within the employment services sector and, in conjunction with information from the Contingent Worker Supplements, to estimate the number of employment services workers assigned to manufacturing over the period. Although measured employment in manufacturing declined by 4

This article empirically examines racial salary differences in the National Basketball Association from 1987 to 1993. The results of our analysis depict the NBA as a racially equal labor market which experienced tremendous growth over this period. In contrast to studies using mid-1980's data which estimated a white advantage between twelve and twenty-five percent, we find that no significant racial wage differential exists. The convergence of the salary differential between 1984 and 1993 can be fully explained by a narrowing in the relative prices paid for additional production and an increase in the relative production of black players. Furthermore, a regression capturing customer preferences yields the result that customers, who during the mid-1980's preferred white players, no longer differentiate between white and black players.