Offsetting Behavior in the Workplace


This paper examines the effect of workplace safety regulations on worker safety. Studies in this area must overcome the issue that regulations and worker safety are jointly determined and that regulatory resources are likely to focus on the worst offenders. We examine the effects of regulatory enforcement in the 1990s on occupational death rates by state in major industries, and propose an instrumental variables technique to isolate the causal effect of regulatory enforcement on worker safety. We find that more inspections lead to higher death rates at a statistically significant level. This counter-intuitive result suggests that increased worker safety measures induce riskier behaviors on the part of workers.