Cover: Workers' Compensation and Workplace Safety

Workers' Compensation and Workplace Safety

Some Lessons from Economic Theory

Published 1982

by Richard A. Victor, Lisa R. Cohen, Charles E. Phelps


Download eBook for Free

FormatFile SizeNotes
PDF file 3 MB

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


Purchase Print Copy

 Format Price
Add to Cart Paperback83 pages $25.00

This report uses the tools of economic theory to analyze how firms can be expected to respond to financial incentives. The report focuses on a statement that is usually assumed to be true and is repeated as conventional wisdom by many policymakers and the researchers who advise them: Increasing Workers' Compensation (WC) benefits induces a firm to increase safety. This report presents the results of a theoretical analysis of how WC financial incentives influence the safety decisions of rational profit-maximizing firms. The research suggests that although the common wisdom has a strong theoretical basis in many cases, it does not have it in all cases, and the empirical evidence fails to provide much support for it. The analysis explores the conditions under which increasing WC benefits may enhance, diminish, or leave unaffected employers' investments in safety.

This report is part of the RAND report series. The report was a product of RAND from 1948 to 1993 that represented the principal publication documenting and transmitting RAND's major research findings and final research.

This document and trademark(s) contained herein are protected by law. This representation of RAND intellectual property is provided for noncommercial use only. Unauthorized posting of this publication online is prohibited; linking directly to this product page is encouraged. Permission is required from RAND to reproduce, or reuse in another form, any of its research documents for commercial purposes. For information on reprint and reuse permissions, please visit

RAND 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.