Wage aspirations and unemployment persistence

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Title: Wage aspirations and unemployment persistence
Authors: Hogan, Vincent (Vincent Peter)
Permanent link: http://hdl.handle.net/10197/935
Date: Apr-2003
Abstract: The reservation wage is an integral part of most theories of involuntary unemployment. We use panel data to examine the empirical determinants of the reservation wage - in particular the influence of previous wages - and consider what this implies for the evolution of the natural rate of unemployment. We find that previous wages have a signi√ěcant but relatively small effect on reservation wages (an elasticity between 0.15 and 0.47). We also find considerable differences across genders with previous wages being more important for men and market wages being more important for women. Overall our results suggest that unemployment will adjust relatively quickly to shocks.
Type of material: Working Paper
Publisher: University College Dublin. School of Economics
University College Dublin. Institute for the Study of Social Change (Geary Institute)
Series/Report no.: UCD Centre for Economic Research Working Paper Series; WP03/10; ISSC Discussion Paper Series; 2003/05
Copyright (published version): UCD School of Economics 2003
Keywords: Unemployment durationWages
Subject LCSH: Unemployment--Effect of wages on
Wages
Other versions: http://www.ucd.ie/economics/research/papers/2003/WP03.10.pdf
Language: en
Status of Item: Not peer reviewed
Appears in Collections:Geary Institute Working Papers
Economics Working Papers & Policy Papers

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