Power and Dignity in Low-Wage Labor Markets: Evidence from Wal-Mart Workers

Grant Type: academic

Grant Year: 2021

Grant Amount: $50,000

Grant description:

A growing body of evidence suggests that monopsony power is an important feature of the low-wage labor market. One reason why employers have some degree of wage-setting power is that jobs are differentiated, meaning workers differently value certain “amenities.” Existing research shows the valuation of nonwage characteristics such as control over schedules. Yet more evidence is needed to understand how nonwage amenities contribute to workplace power. This research will use a Facebook survey of workers at Walmart Inc. to shed new light on the degree of monopsony power in the U.S. labor market and the role of amenities in monopsony. The survey presents Walmart workers with hypothetical job offers, with random wage draws, to estimate the quit elasticity. This can be translated into the firm-specific labor supply curve, a measure of the degree of monopsony. Dube will then ask how amenities other than wages at the job affect quits, specifically using a regression framework to scale those factors into a money-metric valuation of different amenities. He will then zoom into “dignity at work” as a specific type of amenity and will test whether minimum wages may affect amenity provision by firms.

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