FELIX  KOENIG     

We present a new method to identify the value of workplace amenities using excess mass in the earnings distribution around budget discontinuities. The approach formalizes the intuition that workers are less responsive to financial incentives when the returns to work depend more strongly on the value of amenities. Applying the approach to the value of workplace safety, we find that workers are willing to forgo 9% of their earnings to reduce fatality risks by 1 in 100,000. We also illustrate how the approach can identify aggregate bundles of amenities linked to a job and measure the value of "enjoyable jobs."

Paid time off is among the most common and most valued employment amenities. This study analyses the labor market effects of mandating paid time off. We leverage a German court ruling that mandated more time off for specific age groups in some industries. We find that the ruling significantly increased paid time off, with limited adverse effects on employment or wages. At the same time, fewer workers exit jobs with more paid time off, suggesting that the utility value of these jobs increases. The results suggest that information frictions lead to under-provision of paid time  off in the labor market and that government paid time off mandates can improve welfare.

Employers report hiring difficulties for a wide range of positions. Why don't wages adjust dynamically to clear market demand? We use novel data on posted wages from a near spot market for labor and document that a small minority of firms raise wages when they struggle to fill positions. An RCT with hiring managers investigates potential constraints on wage adjustments by offering hiring managers automated wage-setting systems that are designed to relax alternative wage setting frictions. We find that a majority of firms would use wage-setting systems that automatically raise wages in response to tightening labor markets, with highest demand among those made experimentally aware of Platform’s A/B testing and labor supply tracking. Our results indicate that adjustment costs and information frictions explain why firms increase wages more aggressively with automated wage setting tools then they do manually. We estimate that the availability of automated wage-surge systems would increase wages on hard to fill positions by 4% and raise job fill rates by roughly 10%. A substantial proportion of these gains can be achieved by providing managers with current information on applicants available in their specific hiring market.