Employment Determination in Enterprises under Communism and in Transition: Evidence from Central Europe
AbstractIn this paper, we present a comparative analysis of employment determination in four transition economies as they move from central planning to a market economy in the early 1990s. We use firm level panel data sets from the Czech Republic, Hungary, Poland and Slovakia to estimate dynamic employment equations for the period immediately before and after the start of transition. We find evidence that firms behave for the most part as if they were on their labor demand curves, with little evidence of labor hoarding. There were significant cross-country variations in the determinants of employment during the reform process however. Hungarian and Polish firms started the transition already substantially reformed, and became even more responsive to market signals as transition proceeded. In contrast, firms in the Czech and Slovak republics started in the completely unresponsive mode characteristic of central planning, but rapidly caught up with their counterparts in Hungary and Poland.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 1370.
Length: 33 pages
Date of creation: Oct 2004
Date of revision:
Publication status: published in: Industrial and Labor Relations Review, 2005, 58 (3), 353-369
Contact details of provider:
Postal: IZA, P.O. Box 7240, D-53072 Bonn, Germany
Phone: +49 228 3894 223
Fax: +49 228 3894 180
Web page: http://www.iza.org
Postal: IZA, Margard Ody, P.O. Box 7240, D-53072 Bonn, Germany
Other versions of this item:
- Swati Basu & Saul Estrin & Jan Svejnar, 2005. "Employment determination in enterprises under communism and in transition: Evidence from Central Europe," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 58(3), pages 353-369, April.
- J23 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Demand
- J50 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - General
This paper has been announced in the following NEP Reports:
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.:
- Svejnar, Jan, 1982. "On the theory of a participatory firm," Journal of Economic Theory, Elsevier, vol. 27(2), pages 313-330, August.
- MaCurdy, Thomas E & Pencavel, John H, 1986. "Testing between Competing Models of Wage and Employment Determination in Unionized Markets," Journal of Political Economy, University of Chicago Press, vol. 94(3), pages S3-S39, June.
- Ham, John C & Svejnar, Jan & Terrell, Katherine, 1998.
"Unemployment and the Social Safety Net during Transitions to a Market Economy: Evidence from the Czech and Slovak Republics,"
American Economic Review,
American Economic Association, vol. 88(5), pages 1117-42, December.
- John Ham & Jan Svejnar & Katherine Terrell, 1998. "Unemployment and the Social Safety Net During Transitions to a Market Economy: Evidence from the Czech and Slovak Republic," William Davidson Institute Working Papers Series 169, William Davidson Institute at the University of Michigan.
- Dani Rodrik, 1992.
"Foreign Trade in Eastern Europe's Transition: Early Results,"
NBER Working Papers
4064, National Bureau of Economic Research, Inc.
- Dani Rodrik, 1994. "Foreign Trade in Eastern Europe's Transition: Early Results," NBER Chapters, in: The Transition in Eastern Europe, Volume 2: Restructuring, pages 319-356 National Bureau of Economic Research, Inc.
- Rodrik, Dani, 1992. "Foreign Trade in Eastern Europe's Transition: Early Results," CEPR Discussion Papers 676, C.E.P.R. Discussion Papers.
- Hamermesh, Daniel S., 1987.
"The demand for labor in the long run,"
Handbook of Labor Economics,
in: O. Ashenfelter & R. Layard (ed.), Handbook of Labor Economics, edition 1, volume 1, chapter 8, pages 429-471
- Prasnikar, Janez, et al, 1994. "Behavior of Participatory Firms in Yugoslavia: Lessons for Transforming Economies," The Review of Economics and Statistics, MIT Press, vol. 76(4), pages 728-41, November.
- Nickell, S.J., 1987. "Dynamic models of labour demand," Handbook of Labor Economics, in: O. Ashenfelter & R. Layard (ed.), Handbook of Labor Economics, edition 1, volume 1, chapter 9, pages 473-522 Elsevier.
- János Kornai, 1994. "Highway and Byways: Studies on Reform and Postcommunist Transition," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262111985, June.
- McDonald, Ian M & Solow, Robert M, 1981. "Wage Bargaining and Employment," American Economic Review, American Economic Association, vol. 71(5), pages 896-908, December.
- Lubomir Lizal & Miroslav Singer & Jan Svejnar, 2001. "Enterprise Breakups And Performance During The Transition From Plan To Market," The Review of Economics and Statistics, MIT Press, vol. 83(1), pages 92-99, February.
- Brown, James N & Ashenfelter, Orley, 1986. "Testing the Efficiency of Employment Contracts," Journal of Political Economy, University of Chicago Press, vol. 94(3), pages S40-S87, June.
- Quandt, Richard E & Rosen, Harvey S, 1989.
"Endogenous Output in an Aggregate Model of the Labor Market,"
The Review of Economics and Statistics,
MIT Press, vol. 71(3), pages 394-400, August.
- R)chard E. Quandt & Harvey S. Rosen, 1989. "Endogenous Output in an Aggregate Model of the Labor Market," NBER Technical Working Papers 0074, National Bureau of Economic Research, Inc.
- Münich, Daniel & Svejnar, Jan, 2007.
"Unemployment in East and West Europe,"
IZA Discussion Papers
2798, Institute for the Study of Labor (IZA).
- Monteiro, Natália Pimenta & Portela, Miguel & Straume, Odd Rune, 2010.
"Firm Ownership and Rent Sharing,"
IZA Discussion Papers
4909, Institute for the Study of Labor (IZA).
- Pierella Paci & Erwin R. Tiongson & Mateusz Walewski & Jacek Liwinski & Maria M. Stoilkova, 2007. "Internal Labor Mobility in Central Europe and the Baltic Region," World Bank Publications, The World Bank, number 6598.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mark Fallak).
If references are entirely missing, you can add them using this form.