RANDOMIZED SAFETY INSPECTIONS AND RISK EXPOSURE ON THE JOB: QUASI-EXPERIMENTAL ESTIMATES OF THE VALUE OF A STATISTICAL LIFE
January 2014
Working Paper Number:
CES-14-05
Abstract
Compensating wages for workplace fatality and accident risks are used to infer the value of a statistical life (VSL), which in turn is used to assess the benefits of human health and safety regulations. The estimation of these wage differentials, however, has been plagued by measurement error and omitted variables. This paper employs the first quasi-experimental design within a labor market setting to overcome such limitations in the ex-tant literature. Specifically, randomly assigned, exogenous federal safety inspections are used to instrument for plant-level risks and combined with confidential U.S. Census data on manufacturing employment to estimate the VSL using a difference-in-differences framework. The VSL is estimated to be between $2 and $4 million ($2011), suggesting prior studies may substantially overstate the value workers place on safety, and therefore, the benefits of health and safety regulations.
Document Tags and Keywords
Keywords
Keywords are automatically generated using KeyBERT, a powerful and innovative
keyword extraction tool that utilizes BERT embeddings to ensure high-quality and contextually relevant
keywords.
By analyzing the content of working papers, KeyBERT identifies terms and phrases that capture the essence of the
text, highlighting the most significant topics and trends. This approach not only enhances searchability but
provides connections that go beyond potentially domain-specific author-defined keywords.
:
economist,
econometric,
endogeneity,
payroll,
estimator,
regulation,
workforce,
occupation,
labor statistics,
layoff,
risk,
compensation,
mortality
Tags
Tags are automatically generated using a pretrained language model from spaCy, which excels at
several tasks, including entity tagging.
The model is able to label words and phrases by part-of-speech,
including "organizations." By filtering for frequent words and phrases labeled as "organizations", papers are
identified to contain references to specific institutions, datasets, and other organizations.
:
Annual Survey of Manufactures,
Bureau of Labor Statistics,
Service Annual Survey,
Ordinary Least Squares,
Permanent Plant Number,
University of Maryland,
Supreme Court,
Environmental Protection Agency,
Chicago Census Research Data Center,
Survey of Income and Program Participation,
Cornell University,
Special Sworn Status
Similar Working Papers
Similarity between working papers are determined by an unsupervised neural
network model
know as Doc2Vec.
Doc2Vec is a model that represents entire documents as fixed-length vectors, allowing for the
capture of semantic meaning in a way that relates to the context of words within the document. The model learns to
associate a unique vector with each document while simultaneously learning word vectors, enabling tasks such as
document classification, clustering, and similarity detection by preserving the order and structure of words. The
document vectors are compared using cosine similarity/distance to determine the most similar working papers.
Papers identified with 🔥 are in the top 20% of similarity.
The 10 most similar working papers to the working paper 'RANDOMIZED SAFETY INSPECTIONS AND RISK EXPOSURE ON THE JOB: QUASI-EXPERIMENTAL ESTIMATES OF THE VALUE OF A STATISTICAL LIFE' are listed below in order of similarity.
-
Working PaperThe Impact of Heterogeneous NOx Regulations on Distributed Electricity Generation in U.S. Manufacturing
April 2015
Working Paper Number:
CES-15-12
The US EPA's command-and-control NOx policies of the early 1990s are associated with a 3.1 percentage point reduction in the likelihood of manufacturing plants vertically integrating the electricity generation process. During the same period California adopted a cap-and-trade program for NOx emissions that resulted in no significant impact on distributed electricity generation in manufacturing. These results suggest that traditional command-and-control approaches to air pollution may exacerbate other market failures such as the energy efficiency gap, because distributed generation is generally recognized as a more energy efficient means of producing electricityView Full Paper PDF
-
Working PaperPredictive Analytics and Organizational Architecture: Plant-Level Evidence from Census Data
January 2019
Working Paper Number:
CES-19-02
We examine trends in the use of predictive analytics for a sample of more than 25,000 manufacturing plants using proprietary data from the US Census Bureau. Comparing 2010 and 2015, we find that use of predictive analytics has increased markedly, with the greatest use in younger plants, professionally-managed firms, more educated workforces, and stable industries. Decisions on data to be gathered originate from headquarters and are associated with less delegation of decision-making and more widespread awareness of quantitative targets among plant employees. Performance targets become more accurate, long-term oriented, and linked to company-wide performance, and management incentives strengthen, both in terms of monetary bonuses and career outcomes. Plants increasing predictive analytics become more efficient, with lower inventory, increased volume of shipments, narrower product mix, reduced management payroll and increased use of flexible and temporary employees. Results are robust to a specification based on increased government demand for data.View Full Paper PDF
-
Working PaperDo EPA Regulations Affect Labor Demand? Evidence From the Pulp and Paper Industry
August 2013
Working Paper Number:
CES-13-39
The popular belief is that environmental regulation must reduce employment, since suchregulations are expected to increase production costs, which would raise prices and thus reducedemand for output, at least in a competitive market. Although this effect might seem obvious, a careful microeconomic analysis shows that it is not guaranteed. Even if environmental regulation reduces output in the regulated industry, abating pollution could require additional labor (e.g. to monitor the abatement capital and meet EPA reporting requirements). It is also possible for pollution abatement technologies to be labor enhancing. In this paper we analyze how a particular EPA regulation, the so-called 'Cluster Rule' (CR) imposed on the pulp and paper industry in 2001, affected employment in that sector. Using establishment level data from the Census of Manufacturers and Annual Survey of Manufacturers at the U.S. Census Bureau from 1992-2007 we find evidence of small employment declines (on the order of 3%-7%), which are sometimes statistically significant, at a subset of the plants covered by the CR.View Full Paper PDF
-
Working PaperPublic Disclosure of Private Information as a Tool for Regulating Environmental Emissions: Firm-Level Responses by Petroleum Refineries to the Toxics Release Inventory
October 2005
Working Paper Number:
CES-05-13
I investigate whether, as is commonly believed -- and if so how -- firm disclosure of so-called "toxic" releases, required since 1987 by the federal "Toxics Release Inventory ("TRI"), has brought about the reductions in toxic releases that have occurred since that time. Existing literature, consisting principally of event studies of stock market returns, suggest that dirty firms experience abnormal negative returns. Using a micro-level data set that links TRI releases to plant level Census data for petroleum refineries, I study plant-level behavior, exploiting state variation in toxics regulations, and exploring the relationship between TRI releases and concomitant regulation of non-toxic pollutants. I find that, although TRI induced public disclosure may have contributed to the decline in reported toxic releases, that alone has not been the cause of those reductions: the evidence is strong that changes in toxic emission intensity are a byproduct of more traditional command and control regulation of emissions of non-toxic pollutants. I find that (1) since 1987, refineries have become substantially cleaner in terms of over-all toxic releases; (2) the clean-up has not occurred through substitution away from TRI listed substances as inputs or alteration in the mix of outputs; and (3) refineries in states with more stringent supplemental regulation of toxics (e.g. with specific state-wide goals for toxic reductions) have significantly lower toxic emission intensity levels than refineries in other states. I find also that (4) TRI air releases are highly correlated with levels of criteria air pollution; (5) both toxic pollution levels and intensity fall with increases in pollution abatement (operating and maintenance) expenditures for non-toxic air pollution; and (6) TRI air releases are affected by being in more stringent regulatory regions for the criteria air pollutants. Finally, I link my data-set with CRSP data to re-evaluate the effect of TRI reporting on company stock market valuation, correcting for a methodological shortcoming (stemming from the fact that all reporting firms face a common event window) of prior event studies of the impact of the TRI. Correcting for that shortcoming, I find that (7) the evidence of negative abnormal returns around TRI reporting dates for petroleum companies is not significant. My findings suggest that the most probable mechanism through which TRI reporting may induce firms to clean up is local and state governmental use of TRI disclosures. They suggest also not only that the perceived effectiveness of TRI regulation has been overstated, but perhaps more importantly that the benefits of command and control regulation of non-toxic pollutants have been underestimated.View Full Paper PDF
-
Working PaperManufacturing Plants' Use of Temporary Workers: An Analysis Using Census Micro Data
December 2008
Working Paper Number:
CES-08-40
Using plant-level data from the Plant Capacity Utilization (PCU) Survey, we examine how manufacturing plants' use of temporary workers is associated with the nature of their output fluctuations and other plant characteristics. We find that plants tend to hire temporary workers when their output can be expected to fall, a result consistent with the notion that firms use temporary workers to reduce costs associated with dismissing permanent employees. In addition, we find that plants whose future output levels are subject to greater uncertainty tend to use more temporary workers. We also examine the effects of wage and benefit levels for permanent workers, unionization rates, turnover rates, seasonal factors, and plant size and age on the use of temporary workers; based on our results, we discuss various views of why firms use temporary workers.View Full Paper PDF
-
Working PaperThe Impact of Minimum Wages on Job Training: An Empirical Exploration with Establishment Data
February 2003
Working Paper Number:
CES-03-04
Human capital theory suggests that workers may finance on-the-job training by accepting lower wages during the training period. Minimum wage laws could reduce job training, then, to the extent they prevent low-wage workers from offering sufficient wage cuts to finance training. Empirical findings on the relationship between minimum wages and job training have failed to reach a consensus. Previous research has relied primarily on survey data from individual workers, which typically lack both detailed measures of job training and important information about the characteristics of firms. This study addresses the issue of minimum wages and on-the-job training with a unique employer survey. We find no evidence indicating that minimum wages reduce the average hours of training of trained employees, and little to suggest that minimum wages reduce the percentage of workers receiving training.View Full Paper PDF
-
Working PaperStrong Employers and Weak Employees: How Does Employer Concentration Affect Wages?
April 2018
Working Paper Number:
CES-18-15
We analyze the effect of local-level labor market concentration on wages. Using plant-level U.S. Census data over the period 1977'2009, we find that: (1) local-level employer concentration exhibits substantial cross-sectional and time-series variation and increases over time; (2) consistent with labor market monopsony power, there is a negative relation between local-level employer concentration and wages that is more pronounced at high levels of concentration and increases over time; (3) the negative relation between labor market concentration and wages is stronger when unionization rates are low; (4) the link between productivity growth and wage growth is stronger when labor markets are less concentrated; and (5) exposure to greater import competition from China (the 'China Shock') is associated with more concentrated labor markets. These five results emphasize the role of local-level labor market monopsonies in influencing firm wage-setting.View Full Paper PDF
-
Working PaperThe Effect of Wage Insurance on Labor Supply: A Test for Income Effects
October 2009
Working Paper Number:
CES-09-37
Studies of moral hazard in wage insurance programs such as Unemployment Insurance (UI) or Workers Compensation (WC) have demonstrated that higher benefits discourage work, emphasizing the price distortion inherent in benefit provision. Utilizing administrative data linking WC claim records to wage records from a UI payroll tax database, I find that the effect of WC benefits on the duration of benefit receipt cannot fully account for the effect of these benefits on post-injury unemployment. This indicates that a significant fraction of the effect of WC benefits on employment is due to an income effect rather than a price distortion.View Full Paper PDF
-
Working PaperEmployee Capitalism or Corporate Socialism? Broad-Based Employee Stock Ownership
December 2009
Working Paper Number:
CES-09-44
How employee share ownership plans (ESOPs) affect employee compensation and shareholder value depends on the size. Small ESOPs, defined as those controlling less than 5% of outstanding shares, benefit both workers and shareholders, implying positive productivity gains. However, the effects of large ESOPs on worker compensation and shareholder value are more or less neutral, suggesting little productivity gains. These differential effects appear to be due to two non-value-creating motives specific to large ESOPS: (1) To form management-worker alliances ala Pagano and Volpin (2005), wherein management bribes workers to garner worker support in thwarting hostile takeover threats and (2) To substitute wages with ESOP shares by cash constrained firms. Worker compensation increases when firms under takeover threats adopt large ESOPs, but only if the firm operates in a non-competitive industry. The effects on firm valuation also depend on the strength of product market competition: When the competition is strong (weak), most of the productivity gains accrue to employees (shareholders). Competitive industry also implies greater job mobility within the industry, enabling workers to take a greater portion of productivity gains.View Full Paper PDF
-
Working PaperThe Direct and Indirect Costs of Food Safety Regulation
September 2008
Working Paper Number:
CES-08-31
The cost of compliance with the Pathogen Reduction Hazard Analysis Critical Control Program (PR/HACCP) rule of 1996 has been controversial since it was first proposed. Surveys have provided some cost information but examined plant size and other indirect effects with limited data and did not make cost estimates of direct cost components, such as mandated tasks. This paper addresses those deficiencies with data from a national survey of meat and poultry plants on PR/HACCP costs. Results indicate that (1) mandated tasks are the most costly component of the PR/HACCP rule, (2) regulation favors large plants over small ones, and (3) private actions are nearly as costly as direct regulation.View Full Paper PDF
