The adoption of workers' compensation in the United States, 1900-1930

Price V. Fishback, Shawn Everett Kantor

Research output: Contribution to journalArticle

56 Scopus citations

Abstract

Workers' compensation was established by a coalition of workers, employers, and insurers who anticipated gains from replacing negligence liability. Employers anticipated reduced uncertainty and administration costs and were able to pass some of the costs of workers' compensation benefits on to workers through lower wages. The average worker anticipated higher postaccident benefits. Even if lower wages meant they "bought" better benefits, they anticipated better "insurance" of accident risk. Insurers expected to expand their coverage of workplace accidents. Legislative action was required because the courts did not recognize private contracts in which workers waived their rights to negligence suits prior to an accident. Changes in employers' liability served as the catalyst uniting the groups in support of the legislation. Workers' compensation was adopted earlier in states where employers' liability costs were increasing more, unions were stronger, plant sizes were larger, and to some extent where the Progressive movement was stronger.

Original languageEnglish (US)
Pages (from-to)305-341
Number of pages37
JournalJournal of Law and Economics
Volume41
Issue number2
StatePublished - Oct 1 1998

ASJC Scopus subject areas

  • Economics and Econometrics
  • Law

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