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The Wage–Health Insurance Trade‐off and Worker Selection: Evidence From the Medical Expenditure Panel Survey 1997 to 2006
Author(s) -
Lluis Stéphanie,
Abraham Jean
Publication year - 2013
Publication title -
industrial relations: a journal of economy and society
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.61
H-Index - 57
eISSN - 1468-232X
pISSN - 0019-8676
DOI - 10.1111/irel.12023
Subject(s) - medical expenditure panel survey , wage , health insurance , panel data , labour economics , business , offset (computer science) , self insurance , health care , economics , demographic economics , actuarial science , economic growth , econometrics , computer science , programming language
Key provisions within healthcare reform will likely further increase the cost of employer‐sponsored insurance. Theory suggests that workers pay for their health insurance through a wage offset. We investigate this issue using data from the M edical E xpenditure P anel S urvey. GMM estimates aimed at correcting for endogenous worker mobility reveal evidence of a trade‐off for workers who are offered health insurance as the only fringe benefit. On the other hand, employees in establishments with a more comprehensive set of benefits enjoy higher wages relative to employees in establishments that offer no benefits. Health also affects the wage–health insurance trade‐off.