This paper is the first causal study using quasi-experimental methods to identify effect of minimum wages on reservation non-workers. We exploit variation in regional exposure introduction a high-impact wage Germany 2015, combined with survey responses about acceptance thresholds job seekers. Results show 16% increase among non-employed seekers at low end distribution during period immediately ...

BACKGROUND BRAC, a large Bangladeshi NGO, recently has been using female volunteer community health workers (CHWs) in Dhaka urban slums to provide maternal and child health services. Due to erratic performance-based income and higher opportunity cost the urban CHWs lose motivation which contributes to high dropout and poor performance. This results challenges for the cost effectiveness and sust...

We estimate that Unemployment Insurance (UI) extensions reduce reemployment wages using sharp age discontinuities in UI eligibility in Germany. We show this effect combines two key policy parameters: the effect of UI on reservation wages and the effect of nonemployment durations on wage offers. Our framework implies if UI extensions do not affect wages conditional on duration, then reservation ...

Multiple Equilibria and Minimum Wages in Labor Markets with Informational Frictions and Heterogeneous Production Technologies It is often argued that a mandatory minimum wage is binding only if the wage density displays a spike at it. In this paper we analyze a model with search frictions and heterogeneous production technologies, in which imposition of a minimum wage affects wages even though,...

The economics of search study the implications of frictions for individual behavior and market performance, due usually to imperfect information about exchange possibilities. This article reviews labor-market research in this area. Individuals search for a job offer by choosing a reservation wage and accepting jobs that pay above that wage. Firms create jobs to maximize profit. The probability ...

Wages in traditional agrarian societies are often observed to be above reservation wages even in the slack season when markets are in a state of excess labour supply. Models of noncooperative wage setting by landlords which explicitly take account of the costs of supervising hired labour and emphasize worker heterogeneity are developed and analyzed. Conditions are given for the existence of com...

Suppose that "uncertainty" about labor market conditions has increased. Does this change induce an unemployed worker to search longer, or shorter? This paper shows that the answer is drastically different depending on whether an increase in "uncertainty" is an increase in risk or that in true uncertainty in the sense of Frank Knight. We show in a general framework that, while an increase in ris...

Job Search with Nonparticipation In a non-stationary job search model we allow unemployed workers to have a permanent option to leave the labor force. Transitions into nonparticipation occur when reservation wages drop below the utility of being nonparticipant. Taking account of these transitions allows the identification of duration dependence in the job offer arrival rate and the wage offer d...

Note that the variance for ηi is normalized to one since we only observe the sign of Z ′ iγ + ηi. Therefore γ can only be identified up to a scale. A classical example of this two-equation model is the wage regression model, where Yi is the observed wage rate and Di is the labor supply decision, which is decided by the latent calculation that one’s expected wage rate is larger than her reservat...