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Grime and Punishment: Job Insecurity and Wage Arrears in the Russian Federation

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  • Hartmut Lehmann
  • Jonathan Wadsworth
  • Alessandro Asquisti

Abstract

Using information from two complementary household survey data sets, we show that for many Russian workers, the dominant form of labor market adjustment in the transition process has been the delayed receipt of wages. Other forms of adjustment at the intensive margin have not been used much. Wage arrears are found across the private, state and budgetary sector. There are large regional variations in the incidence of wage arrears. Workers in the metropolitan center are significantly less affected by delayed and incomplete wage payments than workers in the provinces. There is less evidence that individual characteristics contribute much toward the incidence of wage arrears. As with the incidence of unemployment however, there is evidence that the persistence of arrears is concentrated on a subset of the working population. We show that workers can only exercise the exit option of a job quit from a firm paying wages in arrears if the outside labor market is sufficiently dynamic.

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Bibliographic Info

Paper provided by LICOS - Centre for Institutions and Economic Performance, KU Leuven in its series LICOS Discussion Papers with number 7999.

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Length: 40 pages
Date of creation: 1999
Date of revision:
Handle: RePEc:lic:licosd:7999

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Keywords: Job Insecurity; Wage Arrears; Labor Markets in Transition;

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  1. Andrei Shleifer, 1996. "Government in Transition," Harvard Institute of Economic Research Working Papers 1783, Harvard - Institute of Economic Research.
  2. Simon Johnson & Daniel Kaufman & Andrei Shleifer, 1997. "The Unofficial Economy in Transition," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 28(2), pages 159-240.
  3. Foley, M.C., 1997. "Labor Market Dynamics in Russia," Papers 780, Yale - Economic Growth Center.
  4. Mark C. Foley, 1997. "Labor Market Dynamics in Russia," Working Papers 780, Economic Growth Center, Yale University.
  5. Hartmut Lehmann & Jonathan Wadsworth, 2000. "Tenures that shook the world: Worker Turnover in Russia, Poland and Britain," LICOS Discussion Papers 9500, LICOS - Centre for Institutions and Economic Performance, KU Leuven.
  6. Richard Layard & Andrea Richter, 1995. "How much unemployment is needed for restructing: the Russian experience," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 3(1), pages 39-58, 03.
  7. G. Alfandari & M.E. Schaffer, 1996. ""Arrears" in the Russian Enterprise Sector," CERT Discussion Papers 9608, Centre for Economic Reform and Transformation, Heriot Watt University.
  8. Mark C. Foley, 1997. "Multiple Job Holding in Russia During Economic Transition," Working Papers 781, Economic Growth Center, Yale University.
  9. Lehmann, Hartmut & Wadsworth, Jonathan & Acquisti,Alessandro, 1998. "Grime And Punishment: Job Insecurity And Wage Arrears in The Russian Federation," Economics Technical Papers 986, Trinity College Dublin, Department of Economics.
  10. Foley, M.C., 1997. "Multiple Job Holding in Russia During Economic Transition," Papers 781, Yale - Economic Growth Center.
  11. Paul Gregg & Jonathan Wadsworth, 1996. "Mind the Gap," CEP Discussion Papers dp0303, Centre for Economic Performance, LSE.
  12. Lehmann, Hartmut & Wadsworth, Jonathan & Acquisti, Alessandro, 1999. "Grime and Punishment: Insecurity and Wage Arrears in the Russian Federation," IZA Discussion Papers 65, Institute for the Study of Labor (IZA).
  13. A. Richter & M.E. Schaffer, 1996. "The Performance of De Novo Private Firms in Russian Manufacturing," CERT Discussion Papers 9610, Centre for Economic Reform and Transformation, Heriot Watt University.
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