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Grime and Punishment: Job Insecurity and Wage Arrears in the Russian Federation

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  • Lehmann, Hartmut
  • Wadsworth, Jonathan
  • Acquisti, Alessandro

Abstract

The initial years of transition in the Russian federation have been characterised by relatively smaller falls in employment than observed in other reform- orientated countries of Eastern Europe. We show that for many Russian workers, the dominant form of labour market adjustment is instead the delayed receipt of wages. There are large regional variations in the incidence of wage arrears. Workers in the metropolitan centre are significantly less affected by delayed and incomplete wage payments than workers in the provinces. There is less evidence that individual characteristics contribute much toward the incidence of wage arrears, though unobserved heterogeneity has some role to play. Wage arrears are found across the skill distribution. As with the incidence of unemployment, however, there is evidence that the persistence of arrears is concentrated on a subset of the working population. We show that workers can only exercise the exit option of a job quit from a firm paying wages in arrears if the outside labour market is sufficiently dynamic.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Comparative Economics.

Volume (Year): 27 (1999)
Issue (Month): 4 (December)
Pages: 595-617

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Handle: RePEc:eee:jcecon:v:27:y:1999:i:4:p:595-617

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Web page: http://www.elsevier.com/locate/inca/622864

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  1. Lehmann, Hartmut & Wadsworth, Jonathan, 2000. "Tenures That Shook the World: Worker Turnover in Russia, Poland, and Britain," Journal of Comparative Economics, Elsevier, vol. 28(4), pages 639-664, December.
  2. Hartmut Lehmann & Jonathan Wadsworth & Alessandro Asquisti, 1999. "Grime and Punishment: Job Insecurity and Wage Arrears in the Russian Federation," LICOS Discussion Papers 7999, LICOS - Centre for Institutions and Economic Performance, KU Leuven.
  3. Richard Layard & Andrea Richter, 1995. "How much unemployment is needed for restructing: the Russian experience," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 3(1), pages 39-58, 03.
  4. Simon Johnson & Daniel Kaufman & Andrei Shleifer, 1997. "The Unofficial Economy in Transition," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 28(2), pages 159-240.
  5. Foley, M.C., 1997. "Multiple Job Holding in Russia During Economic Transition," Papers 781, Yale - Economic Growth Center.
  6. A. Richter & M.E. Schaffer, 1996. "The Performance of De Novo Private Firms in Russian Manufacturing," CERT Discussion Papers 9610, Centre for Economic Reform and Transformation, Heriot Watt University.
  7. Lehmann, Hartmut & Wadsworth, Jonathan & Acquisti, Alessandro, 1999. "Grime and Punishment: Insecurity and Wage Arrears in the Russian Federation," IZA Discussion Papers 65, Institute for the Study of Labor (IZA).
  8. Mark C. Foley, 1997. "Multiple Job Holding in Russia During Economic Transition," Working Papers 781, Economic Growth Center, Yale University.
  9. Paul Gregg & Jonathan Wadsworth, 1996. "Mind the Gap," CEP Discussion Papers dp0303, Centre for Economic Performance, LSE.
  10. Mark C. Foley, 1997. "Labor Market Dynamics in Russia," Working Papers 780, Economic Growth Center, Yale University.
  11. Foley, M.C., 1997. "Labor Market Dynamics in Russia," Papers 780, Yale - Economic Growth Center.
  12. Shleifer, Andrei, 1997. "Government in transition," European Economic Review, Elsevier, vol. 41(3-5), pages 385-410, April.
  13. G. Alfandari & M.E. Schaffer, 1996. ""Arrears" in the Russian Enterprise Sector," CERT Discussion Papers 9608, Centre for Economic Reform and Transformation, Heriot Watt University.
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