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Teleworkers in Italy: who are they? Do they make more?

Claudia Pigini () and Stefano Staffolani ()

International Journal of Manpower, 2019, vol. 40, issue 2, 265-285

Abstract: Purpose - The purpose of this paper is to investigate the determinants of the probability of being a teleworker and the extent of earnings differentials between teleworkers and traditional employees. Design/methodology/approach - The analysis is grounded on a theoretical framework depicting endogenous telework assignment and wage variations based on individual bargaining. The empirical strategy allows for non-random telework assignment, generating from individual- and job-specific observed as well as unobserved factors. Findings - Results are based on the Italian labor force survey and uncover a key role of gender, higher education and family composition as determinants of the probability of teleworking. Furthermore, teleworkers enjoy a wage premium ranging between 2.7 and 8 percent. Originality/value - Accounting for observed individual and job-specific effects, by both standard linear regression and propensity score matching, largely reduces the extent of wage premium emerging from unconditional descriptives; the results of an endogenous switching regression model however suggest that failing to properly care for unobserved factors leads to the underestimation of returns to telework.

Keywords: Wage differentials; Propensity score matching; Teleworking; Switching regression model; J22; J31; J81; C34; C14 (search for similar items in EconPapers)
Date: 2019
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