Empirics of Reservation Wages

Alan B. Krueger has  a new paper: 

This paper provides evidence on the behavior of reservation wages over the spell of unemployment using high‐frequency longitudinal data. Using data from our survey of unemployed workers in New Jersey, where workers were interviewed each week for up to 24 weeks, we find that self‐reported reservation wages decline at a modest rate over the spell of unemployment, with point estimates ranging from 0.05 to 0.14 percent per week of unemployment. The decline in reservation wages is driven primarily by older individuals and those with personal savings at the start of the survey. The longitudinal nature of the data also allows us to test the relationship between job acceptance and the reservation wage and offered wage, where the reservation wage is measured from a previous interview to avoid bias due to cognitive dissonance. Job offers are more likely to be accepted if the offered wage exceeds the reservation wage, and the reservation wage has more predictive power in this regard than the pre-displacement wage, suggesting the reservation wage contains useful information about workers’ future decisions. In addition, there is a discrete rise in job acceptance when the offered wage exceeds the reservation wage. In comparison to a calibrated job search model, the reservation wage starts out too high and declines too slowly, on average, suggesting that many workers persistently misjudge their prospects or anchor their reservation wage on their previous wage.

If you google it you can find several ungated versions of the paper.  

Gender Wage Gap (EU Countries)

From Zizza (2013).

Female Employment and Fertility - The Effects of Rising Female Wages

In a new paper, Female Employment and Fertility - The Effects of Rising Female Wages (July 2012), Christian Siegel, writes:

Increases in female employment and falling fertility rates have often been linked to rising female wages. However, over the last 30 years the US total fertility rate has been fairly stable while female wages have continued to grow. Over the same period, we observe that women's hours spent on housework have declined, but men's have increased.

The paper shows the stable evolution of the fertility rate and the decreasing gender wage gap (by 2005 the average women wage was around 77% of the average male wage, it was  around 60% in the late 1960s). 

HT: Clarence Nkengne Tsimpo.

The power of higher wages

Based on the experimental design, we show that offering higher wages attracts individuals with higher previous earnings, and who have both higher IQ and more desirable personality traits, as measured by the Big 5 personality and public service motivation tests.

The announcements were made to recruit for public sector positions. 

That is from a new paper, "Strengthening State Capabilities: The Role of Financial Incentives in the Call to Public Service," by Dal Bó, Finan, and Rossi (June 2012). Evidence for efficiency wages?