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The Distribution of Wages in Transition Countries

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Author Info
Newell, Andrew () (University of Sussex and IZA, Bonn)

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Abstract

This paper seeks to document and analyse changes in the distribution of wages and employment in the transition countries since the collapse of communism. Most countries experienced an increase in wage inequality during the initial shock of the transition. Proximate causes of this increase seem to be sectoral shifts in employment and increasing inter-industry wage differentials. In Eastern Europe, where economic growth has restarted, there have been further increases in income inequality. These changes are arguably the best guide to future trends in the wage distribution. Taking the case of Poland, rising inequality appears to be entirely accounted for by an increased incidence of workless households. This rise in workless households derives from two phenomena: rising participation in post-compulsory education and earlier retirement. Also in Poland, though there is no change in hourly wage inequality, structural change has had clear impacts of the distribution of wages with increased wage premia to education, to growing sectors and geographically advantaged regions in the economy and to senior occupations.

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Publisher Info
Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 267.

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Length: 33 pages
Date of creation: Mar 2001
Date of revision:
Handle: RePEc:iza:izadps:dp267

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Related research
Keywords: Wage distribution; inequality; transition; and structural change;

Find related papers by JEL classification:
J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
P2 - Economic Systems - - Socialist Systems and Transition Economies

This paper has been announced in the following NEP Reports:

Cited by:
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  1. Mihails Hazans, 2005. "Does Commuting Reduce Wage Disparities?," Labor and Demography 0509012, EconWPA. [Downloadable!]
    Other versions:
  2. Mitra, Pradeep & Yemtsov, Ruslan, 2006. "Increasing inequality in transition economies : is there more to come?," Policy Research Working Paper Series 4007, The World Bank. [Downloadable!]
  3. Ina Ganguli & Katherine Terrell, 2005. "Institutions, Markets and Men’s and Women’s Wage Inequality: Evidence from Ukraine," IZA Discussion Papers 1724, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  4. François Rycx & Ilan Tojerow & Daphné Valsamis, 2008. "Wage differentials across sectors in Europe: an east-west comparison," Working Papers DULBEA 08-17.RS, Université libre de Bruxelles, Department of Applied Economics (DULBEA). [Downloadable!]
    Other versions:
  5. Amy Y.C. Liu, 2005. "Changing wage structure and education in Vietnam 1993-1998 - The roles of demand," Development Economics Working Papers 596, East Asian Bureau of Economic Research. [Downloadable!]
    Other versions:
  6. Puja Vasudeva Dutta, 2005. "Accounting for Wage Inequality in India," PRUS Working Papers 29, Poverty Research Unit at Sussex, University of Sussex. [Downloadable!]
  7. Pastore, Francesco & Verashchagina, Alina, 2004. "The Distribution of Wages in Belarus," IZA Discussion Papers 1140, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  8. Lukiyanova Anna, 2006. "Wage Inequality in Russia (1994–2003)," EERC Working Paper Series 06-03e, EERC Research Network, Russia and CIS. [Downloadable!]
  9. Hazans, Mihails, 2002. "Social returns to commuting in the Baltic states," ERSA conference papers ersa02p232, European Regional Science Association. [Downloadable!]
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