Compensating Differentials for the Risk of Reinjury – Lessons from Professional Boxing.

This article examines how wages compensate professional boxers for the risk of reinjury from mild Traumatic Brain Injury (mTBI), specifically focusing on knockout reinjury risk. Using a new panel dataset of 1,211 male professional boxers who fought in California and Nevada from 2009 to 2017, the study finds that boxers with prior knockout losses earn significantly higher compensating differentials for facing knockout risk compared to those who have never been knocked out, who receive negligible premiums. The analysis controls for various fight- and boxer-specific factors and includes robustness checks that confirm these findings are not driven by bargaining power or audience preferences. The results suggest that current estimates of the value of a statistical injury (VSI) underestimate the willingness of previously injured workers to pay for safety, with implications for labor economics and occupational health beyond professional boxing.