Will Increased Wages Reduce Shortage of Nurses? A Panel Data Analysis of Nurses' Labour Supply

Shortage of nurses is a problem in several countries. It is an unsettled question whether increasing wages constitute a viable policy for extracting more labour supply from nurses. In this paper we use a unique matched panel data set of Norwegian nurses covering the period 1993-1998 to estimate wage elasticities. The data set includes detailed information on 19,638 individuals over 6 years totalling 69,122 observations. The estimated wage elasticity after controlling for individual heterogeneity, sample selection and instrumenting for possible endogeneity is 0.21. Individual and institutional features are statistically significant and important for working hours. Contractual arrangements as represented by shift work are also important for hours of work, and omitting information about this common phenomenon will underestimate the wage effect.

[1]  Bertrand Melenberg,et al.  An analysis of housing expenditure using semiparametric models and panel data , 2001 .

[2]  Kai A. Konrad,et al.  Globalization and Risky Human-Capital Investment , 2003 .

[3]  Nina Berven.  National Politics and Global Ideas? Welfare, Work and Legitimacy in Norway and the United States , 2002 .

[4]  Christian Madsen.  Spiller det noen rolle? - om hverdagen på nye og gamle sykehjem , 2002 .

[5]  M. Verbeek,et al.  Testing for selectivity bias in panel data models , 1992 .

[6]  Ekaterini Kyriazidou,et al.  Estimation of a Panel Data Sample Selection Model , 1997 .

[7]  J. Heckman.  Sample selection bias as a specification error , 1979 .

[8]  Mangfold eller konformitet? Likheter og forskjeller innenfor og mellom fem statlige tilknytningsformer , 2002 .

[9]  Tom Christensen,et al.  Complex Patterns of Interaction and Influence Among Political and Administrative Leaders , 2002 .

[10]  Knut Grove.  Frå privat initiativ til kommunalt monopol. Lysverk, sporvegar og renovasjon i Bergen og Oslo 1850–1935 , 2002 .

[11]  D. Christensen.  Hovedtyper av valgordninger. Proporsjonalitet eller politisk styring , 2002 .

[12]  A. Scott,et al.  The labour market for nursing: a review of the labour supply literature. , 2003, Health economics.

[13]  V. Phillips.  Nurses' labor supply: participation, hours of work, and discontinuities in the supply function. , 1995, Journal of Health Economics.

[14]  M. Tjomsland.  Arbeidsinnvandringssituasjonen i Norge etter 1975 , 2002 .

[15]  C. Bollinger,et al.  Measurement Error in the Current Population Survey: A Nonparametric Look , 1998, Journal of Labor Economics.

[16]  J. Poterba,et al.  REPORTING ERRORS AND LABOR MARKET DYNAMICS , 1986 .

[17]  Christian Dustmann,et al.  Selection Correction in Panel Data Models: An Application to Labour Supply and Wages , 2000, SSRN Electronic Journal.

[18]  B. Hirsch,et al.  Monopsony power and relative wages in the labor market for nurses. , 1995, Journal of health economics.

[19]  B. Hirsch,et al.  Union wages, rents, and skills in health care labor markets , 1998 .

[20]  D. Ault,et al.  On selecting a measure of labour activity: evidence from registered nurses, 1981 and 1989 , 1994 .

[21]  Kai A. Konrad,et al.  Human Capital Investment and Globalization in Extortionary States , 2002 .

[22]  Elin Aasmundrud Mathiesen.  Fritt sykehusvalg. En teoretisk analyse av konkurranse i det norske sykehusmarkedet , 2002 .

[23]  T. Holmås.  Keeping nurses at work: a duration analysis. , 2002, Health economics.