American Economic Journal:
Macroeconomics
ISSN 1945-7707 (Print) | ISSN 1945-7715 (Online)
How Wage Announcements Affect Job Search—A Field Experiment
American Economic Journal: Macroeconomics
(pp. 1–67)
Abstract
In a field experiment, we study how job seekers respond to posted wages by assigning wages randomly to pairs of otherwise similar vacancies in a large number of professions. Higher wages attract significantly more interest. Still, a nontrivial number of applicants only reveal an interest in the low-wage vacancy. With a complementary survey, we show that external raters perceive higher-wage jobs as more competitive. These findings qualitatively support core predictions of theories of directed/competitive search, though in the simplest calibrated model, applications react too strongly to the wage. We discuss extensions such as on-the-job search that rectify this.Citation
Belot, Michèle, Philipp Kircher, and Paul Muller. 2022. "How Wage Announcements Affect Job Search—A Field Experiment." American Economic Journal: Macroeconomics 14 (4): 1–67. DOI: 10.1257/mac.20200116Additional Materials
JEL Classification
- C93 Field Experiments
- J31 Wage Level and Structure; Wage Differentials
- J63 Labor Turnover; Vacancies; Layoffs
- J64 Unemployment: Models, Duration, Incidence, and Job Search