Abstract
This paper presents results from a pre-registered field experiment conducted with the Australian Department of Employment, examining the role of job seekers’ beliefs in shaping job search behavior, reservation wages, and reemployment outcomes. Prior research shows that beliefs often deviate from rational expectations, with job seekers displaying excessive optimism that may hinder reemployment. To address this, about 2,000 unemployed individuals were surveyed and randomly provided personalized information on job-finding rates. Combining longitudinal survey and administrative data, we assess how corrected beliefs influence search effort, wage expectations, and outcomes, providing the first experimental evidence on belief formation during unemployment.