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 1330, Economics Working Paper Series from University of St. Gallen, School of Economics and Political Science

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 higherskilled 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: E32 E43 E50 E52 (search for similar items in EconPapers)
Pages: 39 pages
Date: 2013-10
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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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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Persistent link: https://EconPapers.repec.org/RePEc:usg:econwp:2013:30

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