Recruiting goals, regime shifts, and the supply of labor to the army

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Abstract
This paper extends the existing literature on military‐labor supply in three ways. First, using Current Population Survey (CPS) data, it develops a more accurate estimate of the alternative wage faced by young men. Second, it endogenizes the high‐quality goal faced by recruiters. As the United States Army Recruiting Command became increasingly better at setting this goal during the 1980's, the assumption that the goal was exogenous to the recruiting process became increasingly suspect. This paper presents evidence that the goal is indeed endogenous. Finally, it presents estimates based on a switching simultaneous‐equations statistical specfication that allows behavior to vary across recruiting environments to reflect the asymmetric incentives faced by recruiters. The findings show that the estimates of the parameters with the greatest policy content are sensitive to each of these specification issues.