person is without job, the lower the reservation wage, again concomitant to the searching costs: a year longer in unemployment, reduces the reservation wage by 0.2%. The effect vanishes for the highlyskilled. However, one should note that due to potential reverse causality, this coefficient may be attenuated. As searching costs are captured in the model imprecisely, through both marriage/children variables and the unemployment spell variable, it is important to note that the inclusion of the latter in the model does not change previous conclusions, pointing to the model’s robustness. Finally, households’ welfare works positively for the reservation wage formation: when household income increases by 10%, the reservation wage increases by 0.4-0.5%, on average. The result vanishes for lowskilled individuals, likely reflecting the correlation between the level of education and the household income.

Sources of own livelihood generally matter for the reservation wage creation. Particularly, persons living in a household who are recipients of remittances from a relative who is not a member of the household, have higher reservation wage by 4-5% compared to a person relying on the wages and pensions of other household member. Apparently, remittances expand the comfort zones for recipients, which has been also found in a recent study of Petreski (2019). However, remittances’ role for the reservation wage is important only for the mid-skilled individuals. Interestingly, social assistance is negatively related to reservation wage. It could be that social-assistance recipients, who are already on the lowest part of the income spectrum have low expectation about wages, which may also be a reflection of their specific circumstances and endowment with some characteristics which have not been already captured by the other variables. The result appears for low-skilled individuals only, reflecting their higher probability to be low-educated. Likewise, with opposite sign, capital income works positively: these are usually households well-endowed with various assets, positioning them on the high part of the income spectrum. The addition of the sources of livelihood for the unemployed persons does not alter any previous result, especially given that sources may capture related variation with household welfare.

Education fields are generally insignificant for the reference-wage differentiation, though with some exceptions. The reference category is ‘general education and services.’ Social sciences impose a reservation wage premium by 4.2%, yet the result vanishes when demand factors enter the regression. On the other hand, health care professionals expect a wage that is 11.1% higher than the reference category. The other profiles do not have a distinct wage expectation. However, a more robust picture is obtained when looking by level of education, especially given primary school completion is not associated with different fields (i.e. all persons with at most primary education are classified under ‘general education’). A degree in health inflates the reservation wage, at the tertiary level. However, the latter should be observed against the international competitiveness of such profiles and their propensity to emigrate in Western Europe.

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