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The Determinants of Child Care Workers' Wages and Compensation: Sectoral Differences, Human Capital, Race, Insiders and Outsiders

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  • H. Naci Mocan
  • Deborah Viola
Abstract
This paper investigates the determinants of wages and compensation in child care centers for teachers and aides. Nonprofit status has no across-the-board impact on wages. The extent of the wage premium enjoyed by some nonprofit workers depends on the category of the nonprofit center, occupation of the workers, and their race. The rate of return to an additional year of tenure is 2 percent for both teachers and aides. The return to prior experience is one percent for teachers and zero for aides. An additional year of general education brings about a 5 percent increase in teacher wages, and half of that amount in aide wages. Specialized training influences teacher wages, but has less impact on aide wages. Unionization has a large impact on both wages and compensation of teachers and aides. Alternative wages of the workers are positively related to teacher and aide wages. An increase in local unemployment decreases aides' wages, but has a positive impact on the wages of teachers. There is evidence of profit sharing in the case of aides, but not teachers. An increase in center size positively impacts teacher wages. This body of evidence indicates both teacher and aide remuneration have non-competitive flavors, where the case is more compelling for aides.

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  • H. Naci Mocan & Deborah Viola, 1997. "The Determinants of Child Care Workers' Wages and Compensation: Sectoral Differences, Human Capital, Race, Insiders and Outsiders," NBER Working Papers 6328, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:6328
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    Cited by:

    1. Blau, David M., 2007. "Unintended consequences of child care regulations," Labour Economics, Elsevier, vol. 14(3), pages 513-538, June.
    2. David M. Blau & H. Naci Mocan, 2002. "The Supply Of Quality In Child Care Centers," The Review of Economics and Statistics, MIT Press, vol. 84(3), pages 483-496, August.
    3. Colm Harmon & Claire Finn & Arnaud Chevalier & Tarja Viitanen, 2006. "The economics of early childhood care and education : technical research paper for the National Economic and Social Forum," Open Access publications 10197/671, School of Economics, University College Dublin.
    4. Cho, In Soo, 2012. "Four essays on risk preferences, entrepreneurship, earnings, occupations, and gender," ISU General Staff Papers 201201010800003883, Iowa State University, Department of Economics.
    5. Cho, In Soo & Orazem, Peter, 2013. "Are Nonprofit Entrepreneurs Also "Jacks-Of-All-Trades"?," Staff General Research Papers Archive 35750, Iowa State University, Department of Economics.
    6. Patrick Francois, 2007. "Making a difference," RAND Journal of Economics, RAND Corporation, vol. 38(3), pages 714-732, September.
    7. SHIMIZUTANI Satoshi & SUZUKI Wataru & NOGUCHI Haruko, 2003. "On the Factor of Bankruptcy of Japanese Third Sector," ESRI Discussion paper series 033, Economic and Social Research Institute (ESRI).
    8. Patrick Francois, 2004. "'Making a Difference': Labor Donations in the Production of Public Goods," The Centre for Market and Public Organisation 04/093, The Centre for Market and Public Organisation, University of Bristol, UK.
    9. Haruko Noguchi & Satoshi Shimizutani & Wataru Suzuki, 2008. "Nonprofit wage premium in the Japanese child care market: evidence from employer-employee matched data," Applied Economics Letters, Taylor & Francis Journals, vol. 15(14), pages 1089-1092.

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    More about this item

    JEL classification:

    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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