by There’s been a lot of recent discussion about relative economic performance of the EU and US as well as (mostly separately) discussion of differences in mortality rates. One way to integrate the two is to think of living in the US as a (very) dangerous occupation, and think about the wage premium demanded by workers to take up such occupations, relative to comparable low-risk jobs. The typical estimate from econometric studies is that a 0.1 per cent chance of death on the job (a really dangerous job) implies a wage premium of around 000/year. For Americans aged between 25 and 65, the annual death rate in 2019 (pre-Covid) ranged between 0.13 and 0.88. EU mortality rates were one-third to half of that. Doing the math, the wage premium that would be needed to take on the
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There’s been a lot of recent discussion about relative economic performance of the EU and US as well as (mostly separately) discussion of differences in mortality rates.
One way to integrate the two is to think of living in the US as a (very) dangerous occupation, and think about the wage premium demanded by workers to take up such occupations, relative to comparable low-risk jobs.
The typical estimate from econometric studies is that a 0.1 per cent chance of death on the job (a really dangerous job) implies a wage premium of around $10000/year.
For Americans aged between 25 and 65, the annual death rate in 2019 (pre-Covid) ranged between 0.13 and 0.88. EU mortality rates were one-third to half of that.
Doing the math, the wage premium that would be needed to take on the extra risk of being a working-age American, compared to the EU, is somewhere between $10000/yr and $40000/yr.
Even the lower figure would push the US down to the middle of the rich-country pack based on standard comparisons of median income.
(From my Substack)