Does It Pay to Work for Free? Wage Returns and Gender Differences in the Market for Volunteers

Guido Cozzi, Noemi Mantovan and Robert Sauer

No 7697, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Working as a volunteer is a widespread phenomenon that has both individual and societal benefits. In this paper, we identify the wage returns to working for free by exploiting exogenous variation in rainfall across local area districts in England, Scotland and Wales. Instrumental variables estimates reveal large returns for both men and women. However, the returns are differentially greater for men and account for a substantial proportion of the gender earnings gap. A comparison of OLS and IV estimates also indicates negative selection into volunteering for both genders. In a model of optimal volunteering, negative selection implies that a reduction in the cost of volunteering will lead to an expanded and higher-skilled pool of volunteers, and greater societal benefits. A policy that has the effect of reducing the cost relatively more for women may also narrow the gender earnings gap.

Keywords: volunteering; altruism; gender differences; discrimination; instrumental variables; rainfall; negative selection (search for similar items in EconPapers)
JEL-codes: C26 D64 H41 J16 J31 J71 (search for similar items in EconPapers)
Pages: 38 pages
Date: 2013-10
New Economics Papers: this item is included in nep-lab, nep-lma and nep-soc
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Published - published in: Oxford Bulletin of Economics and Statistics, 2017, 79(6), 1018-1045

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Working Paper: Does it Pay to Work for Free? Wage Returns and Gender Differences in the Market for Volunteers (2013)
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