Compensation for earnings risk under worker heterogeneity
By: by Peter Berkhout, Joop Hartog, Dinand Webbink
Contributors: Hartog, Joop
Series: Discussion paper -- no. 2074; Discussion paper (Forschungsinstitut zur Zukunft der Arbeit : Online) -- no. 2074
Publisher: IZA
Published: 2006
Place of publication: Bonn, Germany
Language: eng
Format: [electronic resource] /
Subjects: Wage differentials; Risk
Description: "We use two large Dutch datasets to estimate the Risk Augmented Mincer equation and test for risk compensation in expected earnings. We replicate earlier findings of a positive premium for risk and a negative premium for skew and add confirmation of the key results if we control for individual ability. We find that immigrants have graduated in more risky educations but obtain identical risk compensation. Among recent graduates, women receive higher risk compensation than men, consistent with their higher risk aversion, while for a labour force cross-section, lower average compensation for women is consistent with their presence in less risky educations. Lower average compensation for vocational graduates than for university graduates is consistent with presumed higher risk aversion and lower observed risk"--Forschungsinstitut zur Zukunft der Arbeit web site.
Notes: Title from PDF file as viewed on 4/11/2006.

Includes bibliographical references.

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