Fringe Benefits in Employee Compensation

by Arleen Leibowitz


Full Document

FormatFile SizeNotes
PDF file 1.3 MB

Use Adobe Acrobat Reader version 10 or higher for the best experience.


Purchase Print Copy

 FormatList Price Price
Add to Cart Paperback47 pages $23.00 $18.40 20% Web Discount

This Note uses data on employees' fringe benefits to study the tradeoff between money wages and fringe benefits, holding worker productivity constant. The data were collected as part of the RAND Health Insurance Study. The results show significant differences by sex in the receipt of fringe benefits. However, regression analysis indicates that lack of data on employee-specific taxable benefits does not greatly bias either rate of return on schooling estimates or earnings comparisons between men and women. Accounting for marginal tax rates had a greater effect on rates of return to schooling than did fringe benefits. Further, the tax and benefit effects tend to offset each other. Hedonic wage equations showed that employees earn compensating differentials when benefits are not provided on the job. However, among those receiving fringe benefits, wages were positively correlated with benefits.

This report is part of the RAND Corporation Note series. The note was a product of the RAND Corporation from 1979 to 1993 that reported other outputs of sponsored research for general distribution.

Permission is given to duplicate this electronic document for personal use only, as long as it is unaltered and complete. Copies may not be duplicated for commercial purposes. Unauthorized posting of RAND PDFs to a non-RAND Web site is prohibited. RAND PDFs are protected under copyright law. For information on reprint and linking permissions, please visit the RAND Permissions page.

The RAND Corporation is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.