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Unemployment and reservation wages in working-class Cape Town

Year: 2005
Author: Nattrass, Nicoli
Unit: ASRU
Journal: South African Journal of Economics
Volume: 73
Issue: 3
Pages: 498-509
Abstract:

Are the unemployed in South Africa 'pricing themselves out of the labour market;'? This paper explores this proposition through an analysis of reservation wages in Cape Town's working class district of Khayelitsha/Mitchell's Plain. It argues that reservation wages are not out of line with predicted wages. This, in turn, suggests that unemployment in the area is not attributable to job seekers having unrealistically high reservation wages.


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