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Title:What are over-the-road truckers paid for? Evidence from an exogenous regulatory change on the role of social comparisons and work organization in wage determination PDF Logo
Authors:Burks, Stephen V.
Guy, Frederick
Issue Date:2012
Series/Report no.:Discussion Paper series, Forschungsinstitut zur Zukunft der Arbeit 6375
Abstract:Using evidence from recent work on truckers and disaggregated older data prior researchers did not have, we revisit a classic topic and find some new answers. We focus on differentials in average annual earnings at the firm level among mileage-paid over-the-road tractor-trailer drivers (road drivers) employed by US for-hire trucking companies, before and after economic deregulation. Road driver output is individualized, and pay is on the basis of a piece rate (mileage). However, road drivers work under two distinct logistical systems - less-than-truckload [LTL], and truckload [TL] - associated with two different forms of work organization. We find that - contrary to the predictions of Rose (1987) - not only are road drivers for LTL companies paid more than those for TL companies, but in LTL the union earnings premium was maintained following deregulation and union coverage fell slowly, while in TL both the union differential and union coverage fell sharply. We review relevant theoretical explanations: payment for cognitive abilities or non-pecuniary disamenities; standard efficiency wage models based on independent utilities; sharing of product market rents; equity concerns resulting from social comparisons between employee groups; and differences in work organization as a source of union rents or quasi-rents. Only equity concerns, for the LTL earnings differential, and quasi rents (but not a union threat effect, contrary to Henrickson and Wilson (2008)), for union coverage and premium in LTL, are consistent with our empirical results. Both earnings differentials are based on differences in work organization, rather than differences in the workers or the work itself.
Subjects:fair wage
equity
compensating differential
cognitive ability
quasi-rent
rent-sharing
work organization
trucking
trucker
less-than-truckload (LTL)
truckload (TL)
regulation
deregulation
union premium
JEL:J31
J42
L92
Persistent Identifier of the first edition:urn:nbn:de:101:1-201206146507
Document Type:Working Paper
Appears in Collections:IZA Discussion Papers, Forschungsinstitut zur Zukunft der Arbeit (IZA)

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