Youth unemployment, firm size and reservation wages in South Africa

Neil Rankin and Gareth A. Roberts

MPRA Paper from University Library of Munich, Germany

Abstract: Youth unemployment in South Africa is high. We investigate whether one of the reasons may be that the wages young people want or need are above those that they could reasonably expect to earn given their characteristics. Unlike previous work on the relationship between reservation wages and unemployment we differentiate between wages in different sizes of firms. Larger firms pay more and thus, even if reservation wages are similar to average predicted wages they may be above wages that young people could expect to earn in smaller firms. We find that this is the case.

Keywords: Youth unemployment; firm size; reservation wages; South Africa (search for similar items in EconPapers)
JEL-codes: J21 J24 J31 J62 J64 (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (4)

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Related works:
Journal Article: YOUTH UNEMPLOYMENT, FIRM SIZE AND RESERVATION WAGES IN SOUTH AFRICA (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:24027

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