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Abstract
This dissertation includes three essays on the economics of job satisfaction. The first, "The Role of Firm Size and Performance Pay in Determining Employee Job Satisfaction", uses the Working in Britain 2000 data to analyze the impact that performance pay has on job satisfaction. The paper argues that the potential positive influences, eliciting greater effort and pay and a tighter connection to the objectives of the firm, are more likely in larger firms. The estimates therefore confirm that even though large firms are known to have lower job satisfaction, proper use of performance pay can ameliorate this otherwise negative association. The second essay, "Fringe Benefits and Job Satisfaction?" uses waves 1996–2004 of the National Longitudinal Survey of Youth (NLSY) to study the impact that fringe benefits have on job satisfaction. Fringe benefits stand as an important part of compensation but confirming their role in determining job satisfaction has been mixed at best. The theory suggesting this role is ambiguous. Fringe benefits represent a desirable form of compensation but might result in decreased earnings and reduced job mobility. In this second essay fringe benefits are established as significant and positive determinants of job satisfaction, even after controlling for individual fixed effects and testing for the endogeneity of fringe benefits. The final essay discusses union exposure and its impact on job satisfaction, specifically that of former union workers. The paper uses all waves of the NLSY to study how length of exposure to a union negatively impacts current job satisfaction for former union members. Furthermore, the length of accumulated time after a worker leaves a union job is positively related to job satisfaction. Therefore, unions have a lasting negative influence on the job satisfaction of workers, even after they leave the union workplace.
