Minimum Wage Effects on Reservation Wages.

Reservation wages are part of the transmission mechanism between minimum wages and unemployment via the labour force participation decision. The limited available empirical evidence on the relationship between reservation wages and legal minimum wages suggest that individuals use minimum wages as be...

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Publicado en:Journal of Labor Research Vol. 43; no. 3/4; pp. 415 - 440
Autores principales: Sousounis, Panos, Lanot, Gauthier
Formato: Artículo
Publicado: Springer Nature Dec2022
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Acceso en línea:Ver este registro en EBSCOhost
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      dt: Dec2022
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        atl: Minimum Wage Effects on Reservation Wages.
      aug:
        au:
          Sousounis, Panos
          Lanot, Gauthier
        affil:
          Department of Economics, The University of Manchester, M13 9PL, Manchester, UK
          School of Business and Economics, Umeå University, SE-901 87, Umeå, Sweden
      su:
        United Kingdom
        Minimum wage
        Wages
        Regression discontinuity design
        Labor supply
        Standard of living
        Wage increases
      sug:
        subj:
          Minimum wage
          Wages
          Regression discontinuity design
          Labor supply
          Standard of living
          United Kingdom
          Temporary Help Services
          Regulation, Licensing, and Inspection of Miscellaneous Commercial Sectors
          Wage increases
      keyword:
        Employment
        Fuzzy regression discontinuity
        J21
        J23
        J31
        J38
        Minimum wages
        Participation rate
        Reservation wages
        Unemployment
        Employment
        Fuzzy regression discontinuity
        J21
        J23
        J31
        J38
        Minimum wages
        Participation rate
        Reservation wages
        Unemployment
      ab: Reservation wages are part of the transmission mechanism between minimum wages and unemployment via the labour force participation decision. The limited available empirical evidence on the relationship between reservation wages and legal minimum wages suggest that individuals use minimum wages as benchmarks against which their reservation wages are set. This has a profound behavioural effect that may encourage individuals to either enter the labour force or price themselves out of potential employment. We employ a fuzzy regression discontinuity design to explore the influence of minimum wages on reservation wages. Our findings suggest that the behavioural response is too small to be extracted from the variability of the reservation wage data. For policy makers this finding is important. While minimum wages raise earnings and living standards, they can push some workers out of the labour force by increasing their reservation wage beyond the minimum. We do not find any evidence of such a response of the reservation wage of jobseekers to the minimum wage in the UK.
      pubtype: Academic Journal
      doctype: Article
      src: R
    language: English
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