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Explaining the Dynamics in Perceptions of Job Insecurity in Russia

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Author Info

  • Lokshin, Michael

    ()
    (World Bank and Higher School of Economics, Moscow)

  • Gimpelson, Vladimir

    ()
    (CLMS, Higher School of Economics, Moscow)

  • Oshchepkov, Aleksey

    ()
    (Higher School of Economics, Moscow)

Abstract

Contrary to the experiences of other countries, perceptions of job insecurity in Russia were not correlated with the rates of unemployment and the business cycle over the last decade. We develop the theoretical framework that predicts that the individual perceptions of job insecurity depend on regional unemployment rates and on the within-group variance of wage distribution faced by workers. We test this hypothesis using data from ten panel rounds of Russia Longitudinal Monitoring Survey. Our results indicate that while higher rates of unemployment make workers feel less job secure, the wage compression during recessions reduces their fears of losing a job. In periods of economic expansion the effect of lower unemployment rates is offset by the higher fears of losing better paying jobs.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 6422.

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Length: 31 pages
Date of creation: Mar 2012
Date of revision:
Handle: RePEc:iza:izadps:dp6422

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Keywords: unemployment; job security; business cycle; Russia;

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References

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  1. Arne Bigsten & Paul Collier & Stefan Dercon & Marcel Fafchamps & Jan Willem Gunning & Abena Oduro & Remco Oostendorp & Cathy Pattillo & Mans Söderbom & Francis Teal & Albert Zeufack, 2003. "Risk Sharing in Labour Markets," Tinbergen Institute Discussion Papers 03-077/2, Tinbergen Institute.
  2. Andrew E. Clark & Andreas Knabe & Steffen Rätzel, 2008. "Boon or Bane? Others' unemployment, well-being and job insecurity," PSE Working Papers halshs-00586022, HAL.
  3. Melvin Stephens, 2004. "Job Loss Expectations, Realizations, and Household Consumption Behavior," The Review of Economics and Statistics, MIT Press, vol. 86(1), pages 253-269, February.
  4. Lemieux, Thomas & MacLeod, W. Bentley & Parent, Daniel, 2007. "Performance Pay and Wage Inequality," IZA Discussion Papers 2850, Institute for the Study of Labor (IZA).
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  6. Simon Luechinger & Stephan Meier & Alois Stutzer, 2010. "Why Does Unemployment Hurt the Employed?: Evidence from the Life Satisfaction Gap Between the Public and the Private Sector," Journal of Human Resources, University of Wisconsin Press, vol. 45(4), pages 998-1045.
  7. Caroli, Eve & Garcia-Penalosa, Cecilia, 2002. "Risk aversion and rising wage inequality," Economics Letters, Elsevier, Elsevier, vol. 77(1), pages 21-26, September.
  8. Keane, Michael & Moffitt, Robert & Runkle, David, 1988. "Real Wages over the Business Cycle: Estimating the Impact of Heterogeneity with Micro Data," Journal of Political Economy, University of Chicago Press, University of Chicago Press, vol. 96(6), pages 1232-66, December.
  9. Dickerson, Andy & Green, Francis, 2012. "Fears and realisations of employment insecurity," Labour Economics, Elsevier, Elsevier, vol. 19(2), pages 198-210.
  10. Green, Francis & Felstead, Alan & Burchell, Brendan, 2000. " Job Insecurity and the Difficulty of Regaining Employment: An Empirical Study of Unemployment Expectations," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 62(0), pages 855-83, Special I.
  11. Gimpelson, Vladimir & Kapeliushnikov, Rostislav, 2011. "Labor Market Adjustment: Is Russia Different?," IZA Discussion Papers 5588, Institute for the Study of Labor (IZA).
  12. V. Gimpelson & G. Monusova., 2010. "Fear of Unemployment: Cross-Country Comparisons," VOPROSY ECONOMIKI, N.P. Redaktsiya zhurnala "Voprosy Economiki", N.P. Redaktsiya zhurnala "Voprosy Economiki", vol. 2.
  13. Linz, Susan J. & Semykina, Anastasia, 2010. "Perceptions of economic insecurity: Evidence from Russia," Economic Systems, Elsevier, Elsevier, vol. 34(4), pages 357-385, December.
  14. Danial Aaronson & Daniel G. Sullivan, 1999. "Worker insecurity and aggregate wage growth," Working Paper Series, Federal Reserve Bank of Chicago WP-99-30, Federal Reserve Bank of Chicago.
  15. David Campbell & Alan Carruth & Andrew Dickerson & Francis Green, 2007. "Job insecurity and wages," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 117(518), pages 544-566, 03.
  16. Vladimir Gimpelson & Aleksey Oshchepkov, 2012. "Does More Unemployment Cause More Fear of Unemployment?," HSE Working papers, National Research University Higher School of Economics WP BRP 13/EC/2012, National Research University Higher School of Economics.
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