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Title:Three essays on wage inequality and health insurance coverage
Author(s):Fang, Chichun
Director of Research:Olson, Craig A.
Doctoral Committee Chair(s):Olson, Craig A.
Doctoral Committee Member(s):Lubotsky, Darren H.; Dencker, John; Brown, Jeffrey R.
Department / Program:School of Labor & Empl. Rel.
Discipline:Human Res & Industrial Rels
Degree Granting Institution:University of Illinois at Urbana-Champaign
Subject(s):Corporate Restructuring
Employer-Sponsored Health Insurance
Racial Gap
Wage Inequality
Abstract:Two of the important issues concerning the general well-beings of the working population-- wage inequality and wage health insurance-- are studied. This thesis consists three chapters. In the first chapter, we (co-authored) examine the effects of corporate restructuring on wage patterns and inequality in a Fortune 500 firm. We show that the restructuring, including reductions in force and transformation in compensation systems, shifts the firm's employment system away from the traditional internal labor market model; hence the wage structure is penetrated by external market forces, leading to lower starting salaries for new hires, lower returns to seniority, and a more polarized wage distribution within the firm. The second chapter addresses the causal relationship between dynamics of health insurance coverage and employment. I find that at most 60% of the male non-elderly population is consistently insured during a 12-year span while only 2% consistently uninsured. Estimating the causal relationship between coverage and employment is challenging because of their correlation and state dependence. A model without controlling for the correlation between coverage and employment suggests that unemployment has a negative impact on the likelihood of being insured that lasts for three years. However, after controlling the correlation between coverage and employment, the effect becomes much smaller. In the final chapter I examine the racial gap in employer-sponsored health insurance coverage as well as how the recent hike in insurance premium affects employer offering as well as employee enrollment in the health insurance plan. The black-white insurance coverage gap is trivial after controlling for individual and job characteristics, but the Hispanic-white gap remains significant. Around one-third of the racial gap can be explained by the racial discrepancy in education and another one-third by the discrepancy in job characteristics. The minorities, nevertheless, are especially vulnerable to the loss of employer offering and hence health insurance coverage when the insurance premium cost increases.
Issue Date:2012-05-22
Rights Information:Copyright 2012 Chichun Fang
Date Available in IDEALS:2012-05-22
Date Deposited:2012-05

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