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Wage Inequality and the Labor Market Impact of Economic Transformation: Croatia, 1970-2008

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Author Info

  • Saul D. Hoffman

    ()
    (Department of Economics,University of Delaware)

  • Ivo Bicanic

    (Department of Economics,University of Zagreb)

  • Oriana Vukoja

    (Department of Economics,University of Zagreb)

Abstract

In this paper, we examine wage inequality and wage differentials in Croatia from 1970 to 2008 using two long aggregate time series on the distribution of income. We focus especially on changing income inequality related to educational and vocational attainment, changing income inequality within those groups, and how these two components of inequality were affected by the economic transformation from Socialism to capitalism. We find that income inequality between groups rose moderately post-transformation, while overall inequality increased more sharply. This finding is consistent with a growing importance of individual rather than group productivity in labor market compensation, a change broadly consistent with the economic transformation of the Croatian labor market.

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Bibliographic Info

Paper provided by University of Delaware, Department of Economics in its series Working Papers with number 11-17.

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Length: 27 pages
Date of creation: 2011
Date of revision:
Publication status: Forthcoming in Economic Systems
Handle: RePEc:dlw:wpaper:11-17.

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Web page: http://www.lerner.udel.edu/departments/economics/department-economics/
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Keywords: Croatia; Economics of Transition; Inequality; Gini coefficient;

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  1. Atkinson,Anthony Barnes & Micklewright,John, 1992. "Economic Transformation in Eastern Europe and the Distribution of Income," Cambridge Books, Cambridge University Press, number 9780521438827, October.
  2. Andrew Clark, 2000. "The Returns and Implications of Human Capital Investment in a Transition Economy: An Empirical Analysis for Russia 1994-1998," CERT Discussion Papers 0002, Centre for Economic Reform and Transformation, Heriot Watt University.
  3. Jan Rutkowski, 1996. "High skills pay off: the changing wage structure during economic transition in Poland," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 4(1), pages 89-112, 05.
  4. Katz, Lawrence F. & Autor, David H., 1999. "Changes in the wage structure and earnings inequality," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 26, pages 1463-1555 Elsevier.
  5. David Card & John E. DiNardo, 2002. "Skill Biased Technological Change and Rising Wage Inequality: Some Problems and Puzzles," NBER Working Papers 8769, National Bureau of Economic Research, Inc.
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