Nurses Wanted. Is the Job Too Harsh or is the Wage Too Low?

When entering the job market, nurses choose among different kínd of jobs. Each of these jobs is characterized by wage, sector (primary care or hospital) and shift (daytime work or shift). This paper estimates a multisector-job-type random utílity model of labor supply on data for Norwegian registered nurses in 2000. The empirical model implies that labor supply is rather inelastic; 10 percent increase in the wage rates for all nurses is estímaled to vield 3.3 percent íncrease in overall labor supply. This modest response shadows for much stronger inter job-type responses. Our approach differs from previous studíes in two ways: First, to our knowledge,it ís thefirst tíme that a model of labour supply for nurses ís estímated takíng explícíty ínto account the choices that RN's have regarding work place and type of job. Second, it differs from previous studies with respect to the measurement of the compensations for different types of work. So far, it has been focused on wage differentíals. But there are more attributes of a job than the wage. Based on the estimated random utílíty model we therefore calculate the expected value of compensatíon that makes a utílíty maxìmìzìng agent indifferent between types of jobs, here behween shift work and daytìme work. It turns out that Nondegian nurses working shifis may be willing to work shift relative to daytime work for lower wage than the current one