PT - JOURNAL ARTICLE AU - Arunachalam, Raj AU - Shah, Manisha TI - Compensated for Life AID - 10.3368/jhr.48.2.345 DP - 2013 Mar 31 TA - Journal of Human Resources PG - 345--369 VI - 48 IP - 2 4099 - http://jhr.uwpress.org/content/48/2/345.short 4100 - http://jhr.uwpress.org/content/48/2/345.full SO - J Hum Resour2013 Mar 31; 48 AB - Sex workers draw a premium for engaging in unprotected sex. We theoretically motivate a test of whether this premium represents a compensating differential for disease, thereby mitigating sex workers’ propensity to use condoms. Using transaction-level data and biological STI markers from sex workers in Ecuador, we exploit within-worker variation across local disease environments. We find that locations with low disease prevalence exhibit a very low, insignificant premium for unprotected sex. A one percentage point increase in the local disease rate increases the premium for noncondom sex by 33 percent. Market forces may curb the self-limiting nature of STI epidemics.