Wage Differentials and Risk of Death: An Empirical Analysis

The Value of a Statistical Life: A Critical Review of Market Estimates throughout the World

“…Researchers have undertaken more than 30 studies of compensating differentials for risk in the U.S. labor market. Some studies have evaluated the wage-risk tradeoff for the entire labor force, while others have focused on subsamples such as specific occupations (e.g., police officers in Low and McPheters 1983), specific states (e.g., South Carolina in Butler 1983), blue-collar workers only (e.g., Dorman andHagstrom 1998 andFairris 1989), males only (e.g., Berger and Gabriel 1991), and union members only (e.g., Dillingham and Smith 1984). These hedonic labor market studies also vary in terms of their choice of mortality risk variable, which can significantly influence the estimation of a value of a statistical life (for comparison of NIOSH and BLS data, refer to Viscusi 1988a andDorman andHagstrom 1998).…”

Safety segregation: The importance of gender, race, and ethnicity on workplace risk

“…Occupational injury rates may be influenced both by the inherent risk of the occupation and the characteristics of the people who enter the occupation (Low and McPheters [16]). In Thaler and Rosen's [32] study of compensating wage differentials, bartending has a higher risk of premature death than police or fire fighting despite the profession appearing safer based on objective criteria.…”

Wage Differentials and Risk of Death: Comment

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In a recent issue of this journal, Stuart Low and Lee McPheters [1983], hereafter L&M, using new data on police salaries and fatalities in the line of duty in 72 cities claim to find:(1) Police receive higher wages in cities with a greater chance of death, other things equal.(2) The value of life implied by their regression is computed to be an amount which exceeds estimates derived using a lost earnings procedure. The purpose of this comment is to indicate that L&M were mistaken in using simply the number of fatalities as the right-hand-side variable in testing for compensating wages and computing value of life.

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“…In a recent issue of this journal, Stuart Low and Lee McPheters [1983], hereafter L&M, using new data on police salaries and fatalities in the line of duty in 72 cities claim to find:…”