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Wages in the East German Transition Process: Facts and Explanations

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Author Info
Wolfgang Franz
Viktor Steiner
Abstract

We analyze wage developments in the East German transition process both at the macro- and at the microeconomic level. At the macroeconomic level, we draw special attention to the important distinction between product and consumption wages, describe the development of various wage measures, labor productivity and unit labor costs in East Germany in relation to West Germany, and relate these developments to the system of collective wage bargaining. At the microeconomic level, we describe changes in the distribution of hourly wages between 1990 and 1997 and analyze the economic factors determining these changes by way of empirical wage functions estimated on the basis of the Socio-Economic Panel for East Germany. The paper also draws some conclusions on the likely future course of the East-West German wage convergence process. Copyright Verein fü Socialpolitik and Blackwell Publishers Ltd 2000.

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File URL: http://www.blackwell-synergy.com/doi/abs/10.1111/1468-0475.00013
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Article provided by Blackwell Publishing in its journal German Economic Review.

Volume (Year): 1 (2000)
Issue (Month): 3 (08)
Pages: 241-269
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Handle: RePEc:bla:germec:v:1:y:2000:i:3:p:241-269

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  1. Gernandt, Johannes & Pfeiffer, Friedhelm, 2008. "Wage Convergence and Inequality after Unification: (East) Germany in Transition," ZEW Discussion Papers 08-022, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research. [Downloadable!]
    Other versions:
  2. Christian Merkl & Dennis J. Snower, 2007. "Escaping the Unemployment Trap — The Case of East Germany," Kiel Working Papers 1309, Kiel Institute for the World Economy. [Downloadable!]
  3. Ira N. Gang & Robert C. Stuart & Myeong-Su Yun, 2006. "Wage Growth and Inequality Change During Rapid Economic Transition," Departmental Working Papers 200631, Rutgers University, Department of Economics. [Downloadable!]
  4. Heike Trappe & Annemette Sørensen, 2005. "Economic Relations between Women and Their Partners : An East-West-German Comparison after Reunification," Discussion Papers of DIW Berlin 544, DIW Berlin, German Institute for Economic Research. [Downloadable!]
  5. Stefan Bach & Giacomo Corneo & Viktor Steiner, 2007. "From Bottom to Top : The Entire Distribution of Market Income in Germany, 1992-2001," SOEPpapers 51, DIW Berlin, The German Socio-Economic Panel (SOEP). [Downloadable!]
    Other versions:
  6. Gang, Ira N. & Yun, Myeong-Su, 2002. "Decomposing Male Inequality Change in East Germany During Transition," IZA Discussion Papers 579, Institute for the Study of Labor (IZA). [Downloadable!]
  7. Boldrin, Michele & Canova, Fabio, 2003. "Regional Policies and EU Enlargement," CEPR Discussion Papers 3744, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  8. Holger Bonin & Rob Euwals, 2002. "Participation Behavior of East German Women after German Unification," William Davidson Institute Working Papers Series 477, William Davidson Institute at the University of Michigan Stephen M. Ross Business School. [Downloadable!]
    Other versions:
  9. Gernandt, Johannes & Pfeiffer, Friedhelm, 2006. "Rising Wage Inequality in Germany," ZEW Discussion Papers 06-19, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research. [Downloadable!]
    Other versions:
  10. Beblo, Miriam & Collier, Irwin L. & Knaus, Thomas, 2001. "The unification bonus (malus) in postwall Eastern Germany," ZEW Discussion Papers 01-29, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research. [Downloadable!]
  11. Ammermüller, Andreas & Weber,Andrea Maria, 2005. "Educational Attainment and Returns to Education in Germany : An Analysis by Subject of Degree, Gender and Region," ZEW Discussion Papers 05-17, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research. [Downloadable!]
  12. Smolny, Werner, 2003. "Beschäftigungsanpassung in Ost- und Westdeutschland : eine makroökonometrische Analyse für die deutschen Bundesländer (Employment adjustment in eastern and western Germany * a macroeconometric ana," Mitteilungen aus der Arbeitsmarkt- und Berufsforschung, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 36(4), pages 428-438. [Downloadable!]
  13. Beblo, Miriam & Wolf, Elke, 2003. "Sind es die Erwerbsunterbrechungen? : ein Erklärungsbeitrag zum Lohnunterschied zwischen Frauen und Männern in Deutschland (Is it the employment interruptions? * a contribution to explaining the wag," Mitteilungen aus der Arbeitsmarkt- und Berufsforschung, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 36(4), pages 560-572. [Downloadable!]
  14. Wolff, Joachim, 2006. "How does experience and job mobility determine wage gain in a transition and a non-transition economy? : the case of east and west Germany," IAB Discussion Paper 200627, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany]. [Downloadable!]
  15. Ira N. Gang & Myeong-Su Yun, 2002. "Decomposing Inequality Change in East Germany During Transition," Departmental Working Papers 200220, Rutgers University, Department of Economics. [Downloadable!]
  16. Merkl, Christian & Snower, Dennis J., 2008. "Escaping the Unemployment Trap: The Case of East Germany," IZA Discussion Papers 3681, Institute for the Study of Labor (IZA). [Downloadable!]
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