Is There a Risk-Return Trade-Off Across Occupations? Evidence from Spain
26 Pages Posted: 22 Oct 2004
Date Written: October 2004
We use data from Spain to test for an effect of earnings risk and skewness on individual wages. We carry out separate estimation for men, women, public and private sector employees. In accordance with previous evidence for the US we show the existence of a risk-return trade-off across occupations in the Spanish labour market. These results are in conformity with preferences of risk-averse individuals with decreasing absolute risk aversion.
Keywords: risk-aversion, skewness affection, occupational choices, compensating wage differentials
JEL Classification: J3, D8
Suggested Citation: Suggested Citation