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Black-White Differences in Reservation Wages and Joblessness: A Replication


  • Stephen M. Petterson


Examining self-reported reservation wages from the 1979-80 waves of the National Longitudinal Survey of Youth (NLSY), Holzer concludes that 26 to 42 percent of the race difference in the length of jobless spells is due to the higher wages sought by young Black men. This replication uses NLSY reservation wage data from 1979 through 1986. Although I find a Black-White difference in reservation wages, I fail to find a positive effect of these measures on the duration of jobless spells. Thus, evidence from the NLSY does not support the claim that reservation wage differences explain the race employment gap.

Suggested Citation

  • Stephen M. Petterson, 1998. "Black-White Differences in Reservation Wages and Joblessness: A Replication," Journal of Human Resources, University of Wisconsin Press, vol. 33(3), pages 758-770.
  • Handle: RePEc:uwp:jhriss:v:33:y:1998:i:3:p:758-770

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    References listed on IDEAS

    1. Kenneth A. Couch & Thomas A. Dunn, 1997. "Intergenerational Correlations in Labor Market Status: A Comparison of the United States and Germany," Journal of Human Resources, University of Wisconsin Press, vol. 32(1), pages 210-232.
    2. Nancy A. Jianakoplos & Paul L. Menchik, 1997. "Wealth Mobility," The Review of Economics and Statistics, MIT Press, vol. 79(1), pages 18-31, February.
    3. Gottschalk, Peter, 1996. "Is the correlation in welfare participation across generations spurious?," Journal of Public Economics, Elsevier, vol. 63(1), pages 1-25, December.
    4. Mary Corcoran & Roger Gordon & Deborah Laren & Gary Solon, 1992. "The Association between Men's Economic Status and Their Family and Community Origins," Journal of Human Resources, University of Wisconsin Press, vol. 27(4), pages 575-601.
    5. Menchik, Paul L, 1979. "Inter-generational Transmission of Inequality: An Empirical Study of Wealth Mobility," Economica, London School of Economics and Political Science, vol. 46(184), pages 349-362, November.
    6. Solon, Gary, 1992. "Intergenerational Income Mobility in the United States," American Economic Review, American Economic Association, vol. 82(3), pages 393-408, June.
    7. Colin Cameron, A. & Windmeijer, Frank A. G., 1997. "An R-squared measure of goodness of fit for some common nonlinear regression models," Journal of Econometrics, Elsevier, vol. 77(2), pages 329-342, April.
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    Cited by:

    1. Koenig, Felix & Manning, Alan & Petrongolo, Barbara, 2014. "Reservation wages and the wage flexibility puzzle," LSE Research Online Documents on Economics 60613, London School of Economics and Political Science, LSE Library.
    2. Mark Stater & Jeffrey B Wenger, 2017. "The Immediate Hardship of Unemployment: Evidence from the US Unemployment Insurance System," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 43(1), pages 17-36, January.
    3. repec:cep:cepdps:dp1319 is not listed on IDEAS
    4. Keith A. Bender & John Douglas Satun, 2009. "Constrained By Hours And Restricted In Wages: The Quality Of Matches In The Labor Market," Economic Inquiry, Western Economic Association International, vol. 47(3), pages 512-529, July.
    5. Donald Haurin & Kala Sridhar, 2003. "The impact of local unemployment rates on reservation wages and the duration of search for a job," Applied Economics, Taylor & Francis Journals, vol. 35(13), pages 1469-1476.
    6. Robert Wagmiller, 2007. "Race and the spatial segregation of jobless men in urban America," Demography, Springer;Population Association of America (PAA), vol. 44(3), pages 539-562, August.

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