Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/46063 
Year of Publication: 
2011
Series/Report no.: 
IZA Discussion Papers No. 5435
Publisher: 
Institute for the Study of Labor (IZA), Bonn
Abstract: 
We analyse a unique data set that combines reservation wage and actually paid wage for a large sample of Dutch recent higher education graduates. On average, accepted wages are almost 8% higher than reservation wages, but there is no fixed proportionality. We find that the difference between reservation wage and accepted wage is virtually random, as search theory predicts. We also find that most information contained in the accepted wage is included in the reservation wage, as one would predict if individuals are well informed about the wage structure that characterizes their labour market.
Subjects: 
reservation wages
starting wages
job search
JEL: 
J31
J69
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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