Determinants of Expected Wages of Unemployed Workers in Turkey
Author(s)
İsmail Şentürk
ABSTRACT
In this study, determinants of expected wages of unemployed individuals in Turkey have been analyzed. In addition to duration of unemployment, reservation wage, and previous wage, the effect of demographic and economic factors has also been studied. The data which were obtained from 1607 individuals who were included in a nationwide survey has been analyzed by the two stage least squares method. Our findings show that previous wage, age, the level of education, the number of foreign languages spoken, the number of job offers the individual receives, and whether the individual receives state assistance determine the expected wage. Obtained results are important because they show how individuals price the variables that determine their own productivities. In addition, our study sheds light on relationships between reservation wage, duration of unemployment, previous wage, and expected wage within the context of Turkey.
In this study, determinants of expected wages of unemployed individuals in Turkey have been analyzed. In addition to duration of unemployment, reservation wage, and previous wage, the effect of demographic and economic factors has also been studied. The data which were obtained from 1607 individuals who were included in a nationwide survey has been analyzed by the two stage least squares method. Our findings show that previous wage, age, the level of education, the number of foreign languages spoken, the number of job offers the individual receives, and whether the individual receives state assistance determine the expected wage. Obtained results are important because they show how individuals price the variables that determine their own productivities. In addition, our study sheds light on relationships between reservation wage, duration of unemployment, previous wage, and expected wage within the context of Turkey.
Cite this paper
Şentürk, İ. (2015) Determinants of Expected Wages of Unemployed Workers in Turkey. Modern Economy, 6, 808-815. doi: 10.4236/me.2015.67076.
Şentürk, İ. (2015) Determinants of Expected Wages of Unemployed Workers in Turkey. Modern Economy, 6, 808-815. doi: 10.4236/me.2015.67076.
References
[1] Brown, S. and Taylor, K. (2009) Reservation Wages, Expected Wages and the Duration of Unemployment: Evidence from British Panel Data. IZA Discussion Paper No. 3981. http://ftp.iza.org/dp3981.pdf [2] Yuhong, D. and Johnes, G. (2003) Influence of Expected Wages on Occupational Choice: New Evidence from Inner Mongolia. Applied Economics Letters, 10, 829-832. http://dx.doi.org/10.1080/1350485032000137477 [3] Alonso-Borrego, C. and Romero-Medina, A. (2014) Wage Expectations for Higher Education Students in Spain. [4] Dominitz, J. (1998) Earnings Expectations, Revisions, and Realizations. Review of Economics and Statistics, 80, 374-388. http://dx.doi.org/10.1162/003465398557618 [5] Das, M. and Van Soest, A. (1999) A Panel Data Model for Subjective Information on Household Income Growth. Journal of Economic Behavior & Organization, 40, 409-426. http://dx.doi.org/10.1016/S0167-2681(99)00062-1 [6] Webbink, D. and Hartog, J. (2004) Can Students Predict Starting Salaries? Yes! Economics of Education Review, 23, 103-113. http://dx.doi.org/10.1016/S0272-7757(03)00080-3 [7] Jerrim, J. (2009) Wage Expectations of UK Students: Are They Realistic? Southampton, UK, Southampton Statistical Sciences Research Institute, S3RI Applications and Policy Working Papers, 57 p. http://eprints.soton.ac.uk/63558/1/63558-01.pdf [8] Maani, S.A. and Studenmund, A.H. (1986) The Critical Wage, Unemployment Duration, and Wage Expectations: The Case of Chile. Industrial & Labor Relations Review, 39, 264-276. http://dx.doi.org/10.1177/001979398603900208 [9] Kalb, G.R. and Scutella, R. (2002) Estimation of Wage Equations in Australia: Allowing for Censored Observations of Labour Supply. Melbourne Institute Working Paper, The University of Melbourne.
https://minerva-access.unimelb.edu.au/bitstream/handle/11343/33657/65783_ 00000091_01_wp2002n08.pdf?sequence=1 [10] Brown, S. and Taylor, K. (2013) Reservation Wages, Expected Wages and Unemployment. Economics Letters, 119, 276-279. http://dx.doi.org/10.1016/j.econlet.2013.02.035 [11] Jones, S.R. (1988) The Relationship between Unemployment Spells and Reservation Wages as a Test of Search Theory. The Quarterly Journal of Economics, 103, 741-765. http://dx.doi.org/10.2307/1886073 [12] Hofler, R.A. and Murphy, K.J. (1994) Estimating Reservation Wages of Employed Workers Using a Stochastic Frontier. Southern Economic Journal, 60, 961-976. http://dx.doi.org/10.2307/1060433 [13] Petterson, S.M. (1997) Are Young Black Men Really Less Willing to Work? American Sociological Review, 62, 605-613. http://dx.doi.org/10.2307/2657429 [14] Mincer, J.A. (1974) Schooling, Experience, and Earnings. NBER. [15] Lippman, S.A. and McCall, J. (1976) The Economics of Job Search: A Survey. Economic Inquiry, 14, 155-189. http://dx.doi.org/10.1111/j.1465-7295.1976.tb00386.x [16] Sant, D.T. (1977) Reservation Wage Rules and Learning Behavior. The Review of Economics and Statistics, 59, 43-49. http://dx.doi.org/10.2307/1924902
[1] Brown, S. and Taylor, K. (2009) Reservation Wages, Expected Wages and the Duration of Unemployment: Evidence from British Panel Data. IZA Discussion Paper No. 3981. http://ftp.iza.org/dp3981.pdf [2] Yuhong, D. and Johnes, G. (2003) Influence of Expected Wages on Occupational Choice: New Evidence from Inner Mongolia. Applied Economics Letters, 10, 829-832. http://dx.doi.org/10.1080/1350485032000137477 [3] Alonso-Borrego, C. and Romero-Medina, A. (2014) Wage Expectations for Higher Education Students in Spain. [4] Dominitz, J. (1998) Earnings Expectations, Revisions, and Realizations. Review of Economics and Statistics, 80, 374-388. http://dx.doi.org/10.1162/003465398557618 [5] Das, M. and Van Soest, A. (1999) A Panel Data Model for Subjective Information on Household Income Growth. Journal of Economic Behavior & Organization, 40, 409-426. http://dx.doi.org/10.1016/S0167-2681(99)00062-1 [6] Webbink, D. and Hartog, J. (2004) Can Students Predict Starting Salaries? Yes! Economics of Education Review, 23, 103-113. http://dx.doi.org/10.1016/S0272-7757(03)00080-3 [7] Jerrim, J. (2009) Wage Expectations of UK Students: Are They Realistic? Southampton, UK, Southampton Statistical Sciences Research Institute, S3RI Applications and Policy Working Papers, 57 p. http://eprints.soton.ac.uk/63558/1/63558-01.pdf [8] Maani, S.A. and Studenmund, A.H. (1986) The Critical Wage, Unemployment Duration, and Wage Expectations: The Case of Chile. Industrial & Labor Relations Review, 39, 264-276. http://dx.doi.org/10.1177/001979398603900208 [9] Kalb, G.R. and Scutella, R. (2002) Estimation of Wage Equations in Australia: Allowing for Censored Observations of Labour Supply. Melbourne Institute Working Paper, The University of Melbourne.
https://minerva-access.unimelb.edu.au/bitstream/handle/11343/33657/65783_ 00000091_01_wp2002n08.pdf?sequence=1 [10] Brown, S. and Taylor, K. (2013) Reservation Wages, Expected Wages and Unemployment. Economics Letters, 119, 276-279. http://dx.doi.org/10.1016/j.econlet.2013.02.035 [11] Jones, S.R. (1988) The Relationship between Unemployment Spells and Reservation Wages as a Test of Search Theory. The Quarterly Journal of Economics, 103, 741-765. http://dx.doi.org/10.2307/1886073 [12] Hofler, R.A. and Murphy, K.J. (1994) Estimating Reservation Wages of Employed Workers Using a Stochastic Frontier. Southern Economic Journal, 60, 961-976. http://dx.doi.org/10.2307/1060433 [13] Petterson, S.M. (1997) Are Young Black Men Really Less Willing to Work? American Sociological Review, 62, 605-613. http://dx.doi.org/10.2307/2657429 [14] Mincer, J.A. (1974) Schooling, Experience, and Earnings. NBER. [15] Lippman, S.A. and McCall, J. (1976) The Economics of Job Search: A Survey. Economic Inquiry, 14, 155-189. http://dx.doi.org/10.1111/j.1465-7295.1976.tb00386.x [16] Sant, D.T. (1977) Reservation Wage Rules and Learning Behavior. The Review of Economics and Statistics, 59, 43-49. http://dx.doi.org/10.2307/1924902