Excellent question! And this blog post has good answers in the form of many [scroll down] helpful reader comments [scroll down]:
"A friend of mine is looking for a new job. She has years of experience in the industry, great technical skills, wonderful contacts, and plenty to brag about. But like most of us, she’s stymied when a job ad asks for a cover letter, ‘complete with salary history and requirements.’ A recent position opening added, ‘The salary information is important! If you don’t tell us what you want to be paid, we can’t tell if we can hire you.’
[snip]
"Personally, I’ve never found a good way to respond to those ‘salary expectations’ requirements. What have you done?
[snip]
Comment by reader MGS:
"This can be a difficult question to answer and can have a variety of results such as:
– Not getting an interview (salary too high or too low).
– Getting a salary offer that is too low or that is lower than direct reports or others in the same type / level of a position.
– Getting a much higher salary
"I do not mind giving my salary expectations; in general I keep this somewhat generic: ‘I expect to be paid in line with what others in a similar position and similar company are earning, adjusted for my experience, expertise, and educational level.’ An acceptable salary also depends upon the expectations, so a $100k job working 40 hours per week is much better than a $100k job working 80 hours per week."