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Journal of Risk and Uncertainty

, Volume 57, Issue 2, pp 111–131 | Cite as

Valuing the risk of workplace sexual harassment

  • Joni Hersch
Article

Abstract

Using data on sexual harassment charges filed with the Equal Employment Opportunity Commission, I calculate the risk of sexual harassment by gender, industry, and age and establish that white females, but not nonwhite females, receive a compensating wage differential for exposure to a higher risk of sexual harassment. I use this risk premium to calculate the value of statistical harassment (VSH) in a manner analogous to the calculation of the value of statistical life (VSL). The VSH is around $7.6 million, about three-quarters of the size of the most-commonly cited levels of the VSL, and far above the maximum damages award for sexual harassment available under federal law. Boosting the maximum damages award to equal the VSH would create the appropriate economic incentives for organizations to deter sexual harassment.

Keywords

Sexual harassment Job risks Compensating differentials Gender discrimination Value of statistical life Deterrence #MeToo 

JEL Classifications

J3 J7 K4 

Notes

Acknowledgements

The author thanks Kathryn Anderson, Vivia Chen, Sarah Dalton, Danielle Drory, Rebecca Greenfield, Erin Meyers, Christina Stoddard, W. Kip Viscusi, and Amy Wolf for valuable comments.

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Copyright information

© Springer Science+Business Media, LLC, part of Springer Nature 2018

Authors and Affiliations

  1. 1.Cornelius Vanderbilt Professor of Law and EconomicsVanderbilt Law SchoolNashvilleUSA

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