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Reservation Wages, Expected Wages and Labour Market Outcomes: Analysis of Individual Level Panel Data

Brown, S. and Taylor, K. (2008) Reservation Wages, Expected Wages and Labour Market Outcomes: Analysis of Individual Level Panel Data. Working Paper. Department of Economics, University of Sheffield ISSN 1749-8368


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Using individual level panel data, we analyse the divergence between an unemployed individual´s reservation wage, as well as their expected wage, and their predicted market wage, focusing upon how job search activities influence the potential divergences. In addition, using propensity score matching techniques, we explore the implications of such divergences for future employment and wages. Our findings, which are consistent with job search theory, suggest that reservation wages (and expected wages) that are high relative to the predicted market wage influence both future employment and future wages.

Item Type: Monograph (Working Paper)
Copyright, Publisher and Additional Information: The Sheffield Economics Research Paper (SERP) series offers a forum for the research output of the academic staff and research students of the Department of Economics, University of Sheffield. Papers are reviewed for quality and presentation by a departmental editor. However, the contents and opinions expressed remain the responsibility of the authors. All papers may be downloaded free on the understanding that the contents are preliminary and therefore permission from the author(s) should be sought before they are referenced.
Keywords: Employment, Job Search, Reservation Wages
Institution: The University of Sheffield
Academic Units: The University of Sheffield > Faculty of Social Sciences (Sheffield) > Department of Economics (Sheffield) > Sheffield Economics Research Papers Series
Depositing User: Repository Officer
Date Deposited: 22 Oct 2009 15:41
Last Modified: 04 Jun 2014 16:05
Published Version: http://www.shef.ac.uk/economics/research/serps/yea...
Status: Published
Publisher: Department of Economics, University of Sheffield
Identification Number: Sheffield Economic Research Paper Series 2008008
URI: http://eprints.whiterose.ac.uk/id/eprint/9982

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