What do jobseekers want? Comparing methods to estimate reservation wages and the value of job attributes
Journal of Development Economics, Volume 159, Article 102978, Year 2022
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Understanding jobseeker preferences – including their reservation wages and how much they value different non-wage amenities – is difficult because they are not directly observable. We test four different methods for estimating these preference parameters using an experiment in a job-matching center. We find large and important differences between the methods. Using a follow up survey for validation, and comparing the consistency of estimates with prior literature, we find that Discrete Choice Experiments perform best. We show how these methods can improve our understanding of labor market frictions and help policymakers and employers develop targeted policies and compensation bundles to address inequities in the labor market.