“Family-Friendly” Fringe Benefits and the Gender Wage Gap

Evidence suggests a large portion of the gender wage gap is explained by gender occupational segregation. A common hypothesis is that gender differences in preferences or abilities explain this segregation; women may prefer jobs that provide more “family-friendly” fringe benefits. Much of the research provides no direct evidence on gender differences in access to fringe benefits, nor how provision affects wages. Using data from the National Longitudinal Survey of Youth 1979, we find that women are more likely to receive family-friendly benefits, but not other types of fringe benefits. We find no evidence that the differences in fringe benefits explain the gender wage gap.

The political economy of the rent-seeking society: The case of public employees and their unions

Evidence is accumulating which suggests that public employee pay levels may contain substantial rent components. The purpose of this study is twofold: to relate the theories of public choice and competitive rent seeking to this evidence and to improve upon existing estimates of rent levels by incorporating the effects of fringe benefits and stability of employment. This study concludes that once nonwage forms of compensation are included, economic rents are contained in pay levels at all three levels of government for both sexes. The authors wish to acknowledge their immense debt to Sharon Smith, who provided us with much of the data used in this study. The assistance of Betsy Rankin is also gratefully acknowledged. The authors alone, however, are responsible for the contents of this article.     

Labor union coercion of employees: The use of fringe benefits

In bargaining on fringe benefits, labor unions violate Section 8(b)(1)(A) of the National Labor Relations Act if they restrict benefits to members only. Even if fringe benefits are provided for nonunion members, a violation of the Act occurs if more stringent eligibility rules are required for nonmembers than for members. Sometimes unions deny fringe benefits to union members if fines or dues are not paid, but National Labor Relations Board has ruled that workers are restrained in violation of Section 8(b)(1)(A) if fringe benefits are withheld due to nonpayment of fines or dues.     

Union-Nonunion differentials and establishment size: Evidence from the NLSY

We provide new empirical evidence on union-nonunion differentials using the 1990 wave of the National Longitudinal Surveys of Youth (NLSY) data set which allows us to examine a broader set of fringe benefits than most other studies and provides a rich set of control variables. Our major finding is that the union effect decreases with establishment size for both components of the compensation structure, i.e., wages and fringe benefits. An earlier version of this paper was presented at the Southern Economic Association conference in Washington, DC in 1996. We thank Tom Hyclak and other session participants. We also acknowledge the financial support from Ade Howe Kent Fund. The usual disclaimer applies.     

The minimum wage can harm workers by reducing unemployment

Economists may disagree over how much raising the minimum wage increases unemployment, though few argue that the unemployment effect is zero. According to the standard model, the less the unemployment caused by a minimum wage increase, the less the harm (or greater the good) that results. But by recognizing that minimum wage workers receive fringe benefits, I show that increasing the minimum wage may not cause any unemployment and harms workers because it doesn 't. Furthermore, when there is lumpiness in providing fringe benefits, a minimum wage increase may harm workers by     

Fringe Benefits and Inequality in the Labor Market

This study shows that when fringe benefits are accounted for, inequality increases at a point in time and grew faster from 1987 to 1994. Several alternative explanations of the observed discrepancies between wage inequality and compensation inequality are assessed. The evidence is that the disproportionately greater decline in income for less skilled workers is responsible for the greater decline in health insurance coverage, which in turn contributes to greater inequality growth when fringe benefits are accounted for.     

ARE PART-TIME WOMEN PAID LESS? A MODEL WITH FIRM-SPECIFIC EFFECTS

This paper uses data from a survey of child-care establishments to compare part-and full-time wages within two narrow occupations, one high skill and one low skill. Unlike previous studies, it controls for firm-specific effects. We find that when firm-specific effects are accounted for, only the low-skill workers in our sample receive lower wages for working part-time. On the other hand, when compensation is defined to include prorated fringe benefits, establishments appear to compensate both high- and low-skill part-timers at a lower hourly rate.     

Minimum wages and the wessels effect in a monopsony model

The Wessels model suggests that firms respond to increases in the minimum wage rate by decreasing the level of fringe benefits — an action which produces an inefficiency effect that lowers workers’ utility and the supply of labor. Standard models of monopsony, however, argue that wage floors prevent the exercise of market power and increase employment. I show that wage floors, even with fringe benefit curtailment, may increase employment by lowering the marginal expense of labor. Employee utility and employment will rise somewhat but not as much had the firm acted competitively in setting both wages and fringes.     

Why unions support mandated benefits

A complete explanation for union support of mandated benefits must recognize that (1) unions promote the interests of their members primarily by restricting entry into labor markets and (2) those restrictions reduce the competitive advantage which unionized firms realize from efficiently providing fringe benefits. Only by exerting pressure on unionized firms to provide particular fringe benefits and then lobbying government to mandate those benefits at nonunion firms can unions hope to overcome a problem of their own creation.     

The Impact of Job Displacement on Employer Based Health Insurance Coverage

We analyze the effect of job displacement on the probability that employer based health insurance is made available to workers. Using fixed and random effects logit models, we do find that displacement is associated with a lower probability of having access to an employer based health insurance plan. Overall this penalty is quite small (between 2 and 3 percentage points), but it becomes substantial (about 16 percentage points) for displaced workers who have been with the current employer for less than 6 months. While we do not find evidence that the penalty associated with being displaced has worsened in recent years, we do find that employers respond to economic hardship by cutting back on fringe benefits.     

Residence laws and unionization in municipal labor markets: The case of firefighters

An estimate is made of the impact of residence laws and unionization on compensation (wages plus major fringe benefits) as well as on employment of municipal firefighters. In addition, hypotheses about the manner in which residence laws exert these effects are econometrically tested using data obtained by surveying the mayors of 560 municipalities. The standard view — that is, that residence laws restrict labor supply — is not supported by the empirical evidence. Rather, the data are consistent with the hypothesis that residence laws affect compensation by altering the bargaining environment; for example, effects of unions are weaker when there are residence laws. The authors would like to express their appreciation to David Lewin and Ronald Ehrenberg for their helpful advice and thoughtful comments, and to two anonymous referees for suggestions which indubitably improved the paper. Significant research assistance was provided by Glen Elder. Financial support by the Institute of Industrial Relations is gratefully acknowledged.     

Broadening the enclave debate: The labor market experiences of Dominican and Colombian men in New York city

This article provides new data on immigrant employment in ethnic firms, in an attempt to go beyond the terms of the ethnic enclave debate as it has developed so far. We contend that enclave research has focused too narrowly on wages. Using data from a survey of Colombian and Dominican immigrants in New York City, we compare enclave, primary, and secondary workers on three types of work-related resources: wages, opportunities for skill acquisition, and access to nonmonetary fringe benefits. We find little evidence that Dominican and Colombia men in the enclave comprise a protected labor market sector. On the contrary, they are disadvantaged with respect to several fringe benefits.An earlier version was presented at the 1990 American Sociological Association meetings.     

Animal Advocacy and the “Good Cop-Bad Cop” Radical Flanking of Laboratory Research

This research explores the concurrent effects of radical and reformist approaches to animal advocacy on how animal welfare is institutionalized in laboratory research. The long-term outcomes of militant animal rights activism are not adequately explained by the two current radical flank effect models: a positive effect where militancy helps moderates, and a negative effect where militancy compromises the movement as a whole. Interviews and participant observation were used to identify a third model—good cop-bad cop radical flanking—that more accurately captures how a longstanding radical fringe of activism affects the institutionalization of animal advocates' demands. Contrary to existing models that describe immediate radical flank effects, a good cop-bad cop model helps explain the long-term effects of militancy and reformism on institutional practices, where activists' seemingly opposing efforts are, in fact, mutually reinforcing.     

Implications of welfare reform on the elderly: a case study of provider, advocate, and consumer perspectives

Whereas many studies of welfare reform have focused on effects on children and families, little research has examined the implications of welfare reform for the elderly. This case study incorporates interviews with service providers for the aging, members of advocacy organizations, and two focus groups of older consumers conducted in the multi-ethnic urban community of San Francisco. Study findings suggest that welfare reform has had both direct and indirect effects on the elderly and their services in the study community. Direct effects derive primarily from changes in the welfare reform legislation that had the effect of undermining both immigrants' eligibility for and claiming of public assistance benefits. Indirect effects on older persons include increased child-care demands upon grandparents. The case study data bear on a significant policy change within the broader trend of devolution at a historical point when anti-immigrant sentiment in the United States was running high.     

Mandated benefits and entry-level employees and employment

Entry-level employees, particularly those with little education and skill, are often not provided fringe benefits that are included in the compensation packages of their more skilled and experienced counterparts. Under the rubric of improving the well-being of entry-level employees, Congress is considering proposals requiring employers provide speccific benefits to employees. Unfortunately, by substituting political directives for market decision making, mandated benefits impose economic inefficiencies, and most of the resulting costs are borne by the entry-level employees purportedly most helped by mandated benefits. The author thanks Ronald Warren for helpful comments. The customary caveat applies.     

Burnout among employees of state residential facilities serving developmentally disabled persons

This research was conducted to determine the prevalence of and variables associated with “burnout” among employees at state residential facilities serving the developmentally disabled. Fourteen heterogeneous facilities from 11 states participated. The sample consisted of 256 top level administrators, 244 direct care professionals, and 224 direct care workers. Subjects from the latter two categories were randomly selected. The results indicated that 15% of the sample were experiencing attitudinal, emotional, and physical exhaustion. Personal variables found to relate significantly to burnout were age, sex, and marital status. Four facility variables showed a significant relationship to burnout: turnover, decision levels, number of directors within the past five years, and fringe benefits. Work related variables showed significant correlations with burnout in 42 of 45 incidences, but none of them were substantial. The findings tend to support the idiosyncratic nature of stress at work which decreases the likelihood of finding a few variables which act as “common causes” of burnout. Results also suggest that the most dedicated, competent, and productive staff members are perhaps the most vulnerable to burnout.     

Being in two minds about a single currency: A UK perspective on the euro

Recent public opinion polls show that the majority of UK citizens are opposed to replacing the pound by the euro. In this paper, we report an initial attempt to elucidate some of the psychological bases of this adherence to the status quo. We tested a latent variable model which postulates that there are two kinds of attachment to national identity, cultural and instrumental attachment, each having both direct and indirect influences upon anti-euro sentiment. The former kind of attachment reflects the symbolic aspects of nationhood, whilst the latter captures the benefits of citizenship, such as the quality and delivery of social goods. Secondly, we investigated the extent to which people's expectations about euro benefits mediates the impact of attachment on anti-euro sentiment. It was found that only cultural attachment had a direct, amplifying effect upon anti-euro sentiment, whilst both forms of attachment had indirect effects via their opposite influences upon euro benefits. Cultural and instrumental attachment respectively had attenuating and amplifying effects on the latter, which itself tended to act as an attenuator on the level of anti-euro sentiment.     

THE EFFECT OF MINIMUM WAGES IN THE PRESENCE OF FRINGE BENEFITS: AN EXPANDED MODEL

Firms may react to a minimum wage hike by reducing their expenditures on fringe benefits. This possibility is incorporated into an expanded model of minimum wages. A set of predictions that differentiate this expanded model from current minimum wage models is derived and tested. The expanded model is shown to better predict the effect of minimum wages on labor force participation, quit rates, and prices than previous models. An interesting result of the expanded model is that a covered worker may be worse off due to a minimum wage hike even if he retains his job.     

Consumer-directed home and community services programs in eight states: policy issues for older people and government.

This study assesses consumer-directed home and community services for older persons by examining public programs that serve this population in eight states. These programs give beneficiaries, rather than agencies, the power to hire, train, supervise, and fire workers. Most stakeholders interviewed, in addition to the quantitative research, indicate that many older beneficiaries want to and can manage their services, although significant issues arise for persons with cognitive impairments. Research results suggest better, or, at least, no worse, quality of life for beneficiaries when they direct their services, although quality of services remains a contentious issue. For workers, consumer-directed care has some disadvantages, including fewer fringe benefits. With exceptions, state agencies have not provided extensive consumer or worker support or aggressively regulated quality of care.     

THE EFFECTS OF SINGLE MOTHERS' WELFARE USE AND EMPLOYMENT DECISIONS ON CHILDREN'S COGNITIVE DEVELOPMENT

We examine the effects of single mothers' welfare use and employment decisions on children's short‐run cognitive development, as measured by their preschool standardized math test scores. We control for three mechanisms through which these decisions might affect children's outcomes: direct monetary benefits, parental time invested in the child, and nonpecuniary benefits from in‐kind transfer programs such as Medicaid. We employ a correction function approach and control for state‐fixed effects to address the endogenous nature of welfare participation and employment decisions. Our estimates suggest that although each additional quarter of either mother's employment or welfare use results in only a small increase in a child's standardized math test score, the total effects after several quarters are sizable. We allow mothers' decisions to have varying effects on attainment by children's observed innate ability and by the intensity of welfare use and employment. A child who has the mean level of observed innate ability with a mother who simultaneously worked and used welfare in all 20 quarters after childbirth experiences an 8.25 standardized‐point increase in standardized scores. The positive impact is more pronounced for the more disadvantaged children, who tend to be born to mothers with low Armed Forces Qualification Test scores, or have lower birth weights. We also examine the effects using timing of employment and welfare use, as well as children's maturity and gender. (JEL I3, J13, J22)