Sandy, Robert, and Robert F. Elliott. 2005. “Long-term Illness and Wages: The Impact of the Risk of Occupationally Related Long-term Illness on Earnings.” Journal of Human Resources 40(3): 744-768.

Long-term illness (LTI) is a more prevalent workplace risk than fatal accidents but there is virtually no evidence for compensating differentials for a broad measure of LTI. In 1990 almost 3.4 percent of the U.K. adult population suffered from a LTI caused solely by their working conditions. This paper provides the first estimates of compensating differentials for a broad measure of work-related LTI. Using data on self-reported illnesses we find significant CDs for male manual workers but none for male nonmanual workers. These results are robust to the addition of variables for the risk of accidental at-work deaths.

Robert Sandy is an associate professor of economics at IUPUI. Robert Elliott is Director of the Health Economics Research Unit and professor of economics, University of Aberdeen, Aberdeen AB24 3QY, Scotland. The authors are grateful for the comments of two anonymous referees, and Michael Jones-Lee, Claudio Lucifora, Richard Perlman, John Ruser, and participants at seminars at the Universities of Sterling, Cork, IUPUI and Milwaukee and at the 1999 ASSA meetings. They also thank John Hodgson and Tracy Clegg at the Health and Safety Executive for supplying data and David Bell at Sterling for help in extracting data from the NES. They are particularly indebted to Joni Hersch for her detailed and constructive comments on an earlier draft of this paper. The data used in this article can be obtained beginning October 2005 through September 2008 from Robert Sandy, Department of Economics, Indiana University-Purdue University-Indianapolis (IUPUI), Cavanaugh Hall, 425 University Boulevard, Indianapolis, Indiana, 46260 <e-mail: icjz100@iupui.edu>

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