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The acceptance of earnings losses after voluntary mobility

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  • Schneck, Stefan

Abstract

Because rational individuals know that they cannot always get what they want, they are assumed to make appropriate adjustments. However, little is known about trade-off reasoning in labor market mobility decision making. The objective of this paper is to analyze the effect of commuting on the decision to voluntarily accept wage cuts. Application of German household data reveals that workers are more likely to accept lower wages when daily commuting expenses can be reduced. In other words, workers trade off amenities and monetary rewards when changing employers.

Suggested Citation

  • Schneck, Stefan, 2010. "The acceptance of earnings losses after voluntary mobility," Economics Discussion Papers 2010-21, Kiel Institute for the World Economy (IfW).
  • Handle: RePEc:zbw:ifwedp:201021
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    References listed on IDEAS

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    1. Thomas Cornelißen, 2009. "The Interaction of Job Satisfaction, Job Search, and Job Changes. An Empirical Investigation with German Panel Data," Journal of Happiness Studies, Springer, vol. 10(3), pages 367-384, June.
    2. Jolivet, Gregory & Postel-Vinay, Fabien & Robin, Jean-Marc, 2006. "The empirical content of the job search model: Labor mobility and wage distributions in Europe and the US," European Economic Review, Elsevier, vol. 50(4), pages 877-907, May.
    3. Fabien Postel-Vinay & Jean-Marc Robin, 2002. "Equilibrium Wage Dispersion with Worker and Employer Heterogeneity," Econometrica, Econometric Society, vol. 70(6), pages 2295-2350, November.
    4. Royalty, Anne Beeson, 1998. "Job-to-Job and Job-to-Nonemployment Turnover by Gender and Education Level," Journal of Labor Economics, University of Chicago Press, vol. 16(2), pages 392-443, April.
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    1. repec:spr:schmbr:v:18:y:2017:i:4:d:10.1007_s41464-017-0030-2 is not listed on IDEAS

    More about this item

    Keywords

    Mobility; wage cut; quit;

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • J62 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Job, Occupational and Intergenerational Mobility; Promotion

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