We find that workers value workplace dignity at approximately six percent of their current wage, comparable to amenities like commute time and more valuable than widely discussed amenities like control over one’s schedule or physical exertion. Motivated by the ethnographic evidence, we expand the set of amenities to include subjective experiences of supervisor respect and fairness, self-expression on the job, and reliable co-workers, which we jointly call "workplace dignity", following a large sociological literature. Using responses to hypothetical outside offers and link click-through rates, we find a quit elasticity of roughly 2, consistent with other recent research showing monopsony power in the low-wage labor market. To implement our methodology, we draw on extensive ethnographic work conducted with 87 Wal-Mart workers to design and implement a survey experiment with over 10,000 Wal-Mart workers recruited online. We show that a distinctive prediction of monopsony is that just-binding minimum wages are not offset by lowered workplace characteristics that are complementary with wages. We discuss a simple model of a monopsonist employer choosing wages jointly with non-wage working conditions.
We present a survey-based methodology for estimating employer market power and worker's valuations of workplace amenities.
Suresh Naidu (Columbia), "Power and Dignity in the Low-Wage Labor Market: Evidence from Wal-Mart Workers" (w/Arindrajit Dube and Adam Reich)
See the seminar's full schedule here: Program on Political Economy