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Title: |
An Alternative Method of Estimating the Worker’s Reservation Wage |
| Author: |
Madhu S. Mohanty |
| Author
Affiliation: |
California State University, Los Angeles, USA |
| Source: |
International Economic Journal, December 2005, v. 19, no. 4, pp. 501-522 |
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Publication Date: |
December 2005 |
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Abstract: |
This study follows the standard bivariate decision theory of employment and proposes an alternative technique to estimate reservation wages of employed, unemployed and out-of-labor-force (OLF) workers. The validity of this approach is demonstrated by testing several reservation wage hypotheses recommended in earlier studies. Using reservation wages estimated under this new approach, the study further examines the determinants of this important variable. |
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