How large is the compensating wage differential for R&D workers?

A. Dupuy, W. Smits

Research output: Contribution to journalArticleAcademicpeer-review


The aim of this paper is to measure the extent to which lower wages in r&d functions reflect a preference effect. In contrast to the bulk of the literature on compensating wage differentials that compares wage levels of jobs with different attributes, we constructed measures of willingness to accept (wta) and pay (wtp) for r&d jobs using the contingent valuation technique. Earnings regressions using ols show an r&d wage penalty of about 3.5%. However, hedonic ols regressions of wta and wtp give significant relative preference parameters for r&d jobs that range from 0.19 to 0.22.
Original languageEnglish
Pages (from-to)423-436
Number of pages13
JournalEconomics of Innovation and New Technology
Issue number5
Publication statusPublished - 1 Jan 2010

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