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Non-wage benefits, costs of turnover, and labor attachment: Evidence from Russian firms

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Author Info
Juurikkala, Tuuli () (BOFIT)
Lazareva, Olga () (Centre for Economic and Financial Research, Moscow)

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Abstract

Just as in established market economies, many Russian firms provide non-wage benefits such as housing, medical care or day care to their employees. Interpreting this as a strategic choice of firms in an imperfect labor market, this paper examines unique survey data for 404 large and medium-size industrial establishments from 40 Russian regions. We find strong evidence that Russian industrial firms use social services to reduce the costs of labor turnover in the face of tight labor markets. The strongest effect is observed for blue-collar workers. We also find that the share of non-monetary compensation decreases with improved access to local social services.

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Publisher Info
Paper provided by Bank of Finland, Institute for Economies in Transition in its series BOFIT Discussion Papers with number 4/2006.

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Length: 31 pages
Date of creation: 13 Apr 2006
Date of revision:
Handle: RePEc:hhs:bofitp:2006_004

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Related research
Keywords: non-wage benefits; labor turnover; labor attachment; Russia;

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Find related papers by JEL classification:
J32 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Nonwage Labor Costs and Benefits; Private Pensions
J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods
J42 - Labor and Demographic Economics - - Particular Labor Markets - - - Monopsony; Segmented Labor Markets
J63 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Turnover; Vacancies; Layoffs
M52 - Business Administration and Business Economics; Marketing; Accounting - - Personnel Economics - - - Compensation and Compensation Methods and Their Effects
P31 - Economic Systems - - Socialist Institutions and Their Transitions - - - Socialist Enterprises and Their Transitions

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  1. Paul Oyer, 2005. "Salary or Benefits?," NBER Working Papers 11817, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  2. Pertti Haaparanta & Tuuli Juurikkala & Olga Lazareva & Ekaterina Zhuravskaya & Jukka Pirttilä & Laura Solanko, 2004. "Firms and public service provision in Russia," Macroeconomics 0401015, EconWPA. [Downloadable!]
    Other versions:
  3. Sabirianova, Klara Z., 2002. "The Great Human Capital Reallocation: A Study of Occupational Mobility in Transitional Russia," Journal of Comparative Economics, Elsevier, vol. 30(1), pages 191-217, March. [Downloadable!] (restricted)
    Other versions:
  4. Anja Decressin & Julia Lane & Kristin McCue & Martha Stinson, 2005. "Employer-Provided Benefit Plans, Workforce Composition and Firm Outcomes," Technical Papers 2005-01, Longitudinal Employer-Household Dynamics, Center for Economic Studies, U.S. Census Bureau. [Downloadable!]
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  7. Brown, J David & Earle, John S, 2002. "The Reallocation of Workers and Jobs in Russian Industry: New Evidence on Measures and Determinants," CEPR Discussion Papers 3663, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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  8. Guido Friebel & Sergei Guriev, 2005. "Attaching Workers Through In-kind Payments: Theory and Evidence from Russia," Working Papers w0057, Center for Economic and Financial Research (CEFIR). [Downloadable!]
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  9. Gustman, A.L. & Mitchell, O.S. & Steinmeier, T.L., 1993. "The Role of Pensions in the Labor Market," Papers 93-07, Cornell - Center for Advanced Human Resource Studies.
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  10. William E. Even & David A. Macpherson, 1996. "Employer size and labor turnover: The role of pensions," Industrial and Labor Relations Review, ILR Review, ILR School, Cornell University, vol. 49(4), pages 707-728, July.
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  12. Atrostic, B K, 1982. "The Demand for Leisure and Nonpecuniary Job Characteristics," American Economic Review, American Economic Association, vol. 72(3), pages 428-40, June. [Downloadable!] (restricted)
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  14. Berger, Mark C. & Blomquist, Glenn C. & Peter, Klara Sabirianova, 2003. "Compensating Differentials in Emerging Labor and Housing Markets: Estimates of Quality of Life in Russian Cities," IZA Discussion Papers 900, Institute for the Study of Labor (IZA). [Downloadable!]
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  15. Woodbury, Stephen A & Hamermesh, Daniel S, 1992. "Taxes, Fringe Benefits and Faculty," The Review of Economics and Statistics, MIT Press, vol. 74(2), pages 287-96, May. [Downloadable!] (restricted)
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  16. William M. Gentry & Eric Peress, 1994. "Taxes and Fringe Benefits Offered by Employers," NBER Working Papers 4764, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  22. Steven J. Davis & John C. Haltiwanger & Scott Schuh, 1998. "Job Creation and Destruction," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262540932, January.
  23. Sonin, Konstantin, 2003. "Provincial Protectionism," CEPR Discussion Papers 3973, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  24. Yuri Andrienko & Sergei Guriev, 2004. "Determinants of interregional mobility in Russia," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 12(1), pages 1-27, 03. [Downloadable!] (restricted)
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Tuuli Juurikkala & Olga Lazareva, 2006. "Lobbying at the local level: social assets in Russian firms," Working Papers w0061, Center for Economic and Financial Research (CEFIR). [Downloadable!]
    Other versions:
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