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The Price of Morals: An Empirical Investigation of Industry Sectors and Perceptions of Moral Satisfaction—Do Business Economists Pay for Morally Satisfying Employment?

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  • Mary Ellen Benedict
  • David McClough
  • Anita C. McClough

Abstract

Many factors contribute to choice of employment other than compensation. This study extends the current literature by testing whether a compensating differential exists in employment sectors deemed morally satisfying. Data from the 1998 salary survey of the National Association for Business Economics (NABE) and sector rankings addressing moral satisfaction provided by a sample of college students are used in a regression analysis. When we include a self-selection correction in the salary regression, business economists in the for-profit sector earned almost 150 percent more than their nonprofit counterparts, once controlling for the choice of employment sector and human capital variables. Average wages were economically and statistically higher for business economists situated in the middle and low moral satisfaction groupings compared to those in the high moral satisfaction sector. Results suggest a compensating differential for those employed in morally satisfying industry sectors.

Suggested Citation

  • Mary Ellen Benedict & David McClough & Anita C. McClough, 2006. "The Price of Morals: An Empirical Investigation of Industry Sectors and Perceptions of Moral Satisfaction—Do Business Economists Pay for Morally Satisfying Employment?," The American Economist, Sage Publications, vol. 50(1), pages 21-36, March.
    • Handle: RePEc:sae:amerec:v:50:y:2006:i:1:p:21-36
    DOI: 10.1177/056943450605000102
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    References listed on IDEAS

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    Cited by:

    1. Florian H. Schneider & Fanny Brun & Roberto A. Weber, 2020. "Sorting and Wage Premiums in Immoral Work," CESifo Working Paper Series 8456, CESifo.

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