In the one-sided model, suppose that workers suffer some level of disutility from high-wage jobs, perhaps because these jobs entail long work hours or extra management responsibilities....

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Ve(w) w0. Under these circumstances, determine the optimal search strategy for a worker, (i.e., what wage offers an unemployed worker will accept). Is this a reservation wage strategy? Explain. (Use the graph to determine the optimal search strategy.) Ve(w) k Vh! v1 Ve(w) When the value of unemployment is less than VL, then the worker will choose a reservation wage the wage VL A When the value of unemployment is greater than VH, then the worker will choose a reservation wage the wage If the value of unemployment falls between VL and Vy, say V, then the worker will accept a wage when the following is satisfied This a reservation W W2 W3 W1 W4 W5 choose any wage strategy because the worker wage which is greater than the reservation wage. 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W1 W3 W4 When the value of unemployment is less than VL, then the worker will choose a reservation wage the wage the wage When the value of unemployment is greater than VH, then the worker will choose a reservation wage If the value of unemployment falls between VL and VH, say V4, then the worker will accept a wage when the following is satisfied This a reservation choose any ation wage. W3 SW sw4 W3 Sw0. Under these circumstances, determine the optimal search strategy for a worker, (i.e., what wage offers an unemployed worker will accept). Is this a reservation wage strategy? Explain. (Use the graph to determine the optimal search strategy.) Ve(w) k Vh! v1 Ve(w) When the value of unemployment is less than VL, then the worker will choose a reservation wage the wage VL A When the value of unemployment is greater than VH, then the worker will choose a reservation wage the wage If the value of unemployment falls between VL and Vy, say V, then the worker will accept a wage when the following is satisfied This a reservation W W2 W3 W1 W4 W5 choose any wage strategy because the worker wage which is greater than the reservation wage. When the value of unemployment is less than VL, then the worker will choose a reservation wage the wage When the value of unemploymen then the worker will choose a reservatic If the va equal to the wage nt less than ept falls between VL and VH, say V', then a wage when the following is satisfied This great than a reservation choose any wage strategy because the worker wage which is greater than the reservation wage. When the value of unemployment is less than VL, then the worker will choose a reservation wage the wage W2 When the value of unemployment is greater than VH, er will choose a reservation wage the wage If the value of unemployment VL and VH, say V, then the worker will accept the following is satisfied This a reservation 1 W5 W4 W3 I because the worker choose any ; greater than the reservation wage. W1 : When the value of unemployment is less than VL, then the worker will choose a reservation wage the wage When the value of unemployment is greater than VH, then the worker will choose a reservation wage the wage If the value of unemployment VH, say V, then the worker will accept greater than wing is satisfied This a reservation less than e the worker choose any equal to than the reservation wage. the wage When the value of unemployment is less than VL, then the worker will choose a reservation wage When the value of unemployment is greater than VH, then the worker will choose a reservation wage If the value of unemployment falls between VL and VH, n the worker will accept a wage when the followin a reservation the wage W5 W2 wage strategy because th wage which is greater tha choose any ition wage. W1 W3 W4 When the value of unemployment is less than VL, then the worker will choose a reservation wage the wage the wage When the value of unemployment is greater than VH, then the worker will choose a reservation wage If the value of unemployment falls between VL and VH, say V4, then the worker will accept a wage when the following is satisfied This a reservation choose any ation wage. W3 SW sw4 W3 Sw