Reservation Wages of First and Second Generation Migrants

Amelie Constant, Annabelle Krause-Pilatus, Ulf Rinne and Klaus Zimmermann ()

No 5396, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This paper analyzes the reservation wages of first and second generation migrants. Based on recently collected and rich survey data of a representative inflow sample into unemployment in Germany, we empirically test the hypothesis that reservation wages increase from first to second generation migrants. Two extensions of the basic job search model, namely an unknown wage offer distribution and different reference standards, provide theoretical justifications for this conjecture. In both extensions, changing frames of reference are identified as a channel through which the phenomenon of increasing reservation wages may arise. In as far as language skills or self-evaluated returns to characteristics reflect a person's frames of reference, we find empirical support for this mechanism to be present.

Keywords: migration; ethnic identity; ethnosizer; Germany; unemployment; job search; reservation wages (search for similar items in EconPapers)
JEL-codes: F22 J15 J61 J64 (search for similar items in EconPapers)
Pages: 36 pages
Date: 2010-12
New Economics Papers: this item is included in nep-lab and nep-mig
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Citations: View citations in EconPapers (15)

Published - revised version published in: Applied Economics Letters , 2017, 24 (13), 945-949

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Related works:
Journal Article: Reservation wages of first- and second-generation migrants (2017)
Working Paper: Reservation wages of first- and second-generation migrants (2016)
Working Paper: Reservation Wages of First and Second Generation Migrants (2011)
Working Paper: Reservation Wages of First and Second Generation Migrants (2010)
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