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Returns to Mobility in the Transition to a Market Economy

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Author Info
Tito Boeri
Christopher J. Flinn

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Abstract

In spite of ongoing dramatic changes in labor market structure, transitional economies display rather low worker flows across sectors and occupations. Such low mobility can be explained by low returns to job changes as well as by market segmentation in the allocation of job offers. We develop an econometric model which enables us to characterize intertemporal changes in probabilities of dismissal, remuneration, and offer arrival rates on the basis of information on observed transitions and wage payments. The model is estimated using data from the Polish Labor Force Survey. Our results indicate a significant degree of segmentation in the allocation of job offers and more stability in public sector versus private sector jobs. Our model can also be used for policy experiments. In particular, we infer that reductions of 10 per cent in the generosity of unemployment benefits will not significantly boost outflows from the unemployment state. These findings support explanations for low mobility in transitional economies, which are based on informational failures, and high costs of moving from public to private enterprises for those with high levels of job tenure and labor market experience in the public sector.

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Publisher Info
Paper provided by William Davidson Institute at the University of Michigan Stephen M. Ross Business School in its series William Davidson Institute Working Papers Series with number 217.

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Date of creation: 01 Jan 1999
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Handle: RePEc:wdi:papers:1999-217

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Related research
Keywords: worker flows; returns to mobility; market segmentation;

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Find related papers by JEL classification:
J62 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Job, Occupational and Intergenerational Mobility; Promotion
J63 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Turnover; Vacancies; Layoffs
J64 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Unemployment: Models, Duration, Incidence, and Job Search

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References listed on IDEAS
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. Lubyova, Martina & van Ours, Jan, 1997. "Unemployment dynamics and the restructuring of the Slovak unemployment benefit system," European Economic Review, Elsevier, vol. 41(3-5), pages 925-934, April. [Downloadable!] (restricted)
  2. Micklewright, John & Nagy, Gyula, 1996. "Labour market policy and the unemployed in Hungary," European Economic Review, Elsevier, vol. 40(3-5), pages 819-828, April. [Downloadable!] (restricted)
  3. Flinn, Christopher J., 1997. "Labor Market Structure and Welfare: A Comparison of Italy and the U.S," Working Papers 97-07, C.V. Starr Center for Applied Economics, New York University. [Downloadable!]
  4. Shorrocks, A F, 1978. "The Measurement of Mobility," Econometrica, Econometric Society, vol. 46(5), pages 1013-24, September. [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. Mal'tseva Inna, 2005. "Gender differences in occupational mobility and segregation at the labor market: The case of Russian economy," EERC Working Paper Series 05-11e, EERC Research Network, Russia and CIS. [Downloadable!]
  2. Carmen Pagés-Serra & Marco Stampini, 2007. "No Education, No Good Jobs? Evidence on the Relationship between Education and Labor Market Segmentation," RES Working Papers 4561, Inter-American Development Bank, Research Department. [Downloadable!]
    Other versions:
  3. Jed Friedman, 2004. "Firm Ownership and Internal Labor Practices in a Transition Economy: An Exploration of Worker Skill Acquisition in Vietnam," William Davidson Institute Working Papers Series 2004-696, William Davidson Institute at the University of Michigan Stephen M. Ross Business School. [Downloadable!]
  4. Randall K. Filer & Jan Hanousek, 2001. "Data Watch: Research Data from Transition Economies," William Davidson Institute Working Papers Series 416, William Davidson Institute at the University of Michigan Stephen M. Ross Business School. [Downloadable!]
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  5. Voicu, Alexandru & Buddelmeyer, Hielke, 2003. "Children and Women's Participation Dynamics: Direct and Indirect Effects," IZA Discussion Papers 729, Institute for the Study of Labor (IZA). [Downloadable!]
  6. Mark C. Berger & John S. Earle & Klara Sabirianova, 2000. "Worker Training in a Restructuring Economy: Evidence from the Russian Transition," William Davidson Institute Working Papers Series 331, William Davidson Institute at the University of Michigan Stephen M. Ross Business School. [Downloadable!]
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  7. Orlowski, Robert & Riphahn, Regina T., 2008. "The East German Wage Structure after Transition," IZA Discussion Papers 3861, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  8. Nauro F. Campos & Fabrizio Coricelli, 2002. "Growth in Transition: What We Know, What We Don't, and What We Should," William Davidson Institute Working Papers Series 470, William Davidson Institute at the University of Michigan Stephen M. Ross Business School. [Downloadable!]
    Other versions:
  9. Steven Stillman, 2000. "Labor Market Uncertainty and Private Sector Labor Supply in Russia," Working Papers 00-16, RAND Corporation Publications Department. [Downloadable!]
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  10. Viliam Druska & Byeong ju Jeong & Michal Kejak & Viatcheslav Vinogradov, 2002. "Assessing the Problem of Human Capital Mismatch in Transition Economies," William Davidson Institute Working Papers Series 467, William Davidson Institute at the University of Michigan Stephen M. Ross Business School. [Downloadable!]
  11. Carmen Pagés-Serra & Marco Stampini, 2007. "¿Sin formación no hay buenos empleos? Elementos de juicio sobre la relación entre la formación y la segmentación del mercado laboral," RES Working Papers 4562, Inter-American Development Bank, Research Department. [Downloadable!]
  12. Jennifer Hunt, 1998. "Post-Unification Wage Growth in East Germany," William Davidson Institute Working Papers Series 304, William Davidson Institute at the University of Michigan Stephen M. Ross Business School. [Downloadable!]
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  13. Yuri Andrienko & Sergei Guriev, 2003. "Determinants of Interregional Mobility in Russia: Evidence from Panel Data," William Davidson Institute Working Papers Series 551, William Davidson Institute at the University of Michigan Stephen M. Ross Business School. [Downloadable!]
    Other versions:
  14. Lukiyanova Anna, 2003. "Transition to Postindustrial Society? A Study of the Service Sector Employment in Russia," EERC Working Paper Series 03-09e, EERC Research Network, Russia and CIS. [Downloadable!]
  15. Sergei Guriev & Barry W. Ickes, 2000. "Microeconomic Aspects of Economic Growth in Eastern Europe and the Former Soviet Union, 1950-2000," William Davidson Institute Working Papers Series 348, William Davidson Institute at the University of Michigan Stephen M. Ross Business School. [Downloadable!]
  16. Boeri, Tito, 2001. "Transition with Labour Supply," IZA Discussion Papers 257, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  17. Klara Z. Sabirianova, 2000. "The Great Human Capital Reallocation: An Empirical Analysis of Occupational Mobility in Transitional Russia," William Davidson Institute Working Papers Series 309, William Davidson Institute at the University of Michigan Stephen M. Ross Business School. [Downloadable!]
  18. Maciej Bukowski & Piotr Lewandowski, 2005. "Transitions from unemployment in Poland: a multinomial logit analysis," Labor and Demography 0511008, EconWPA, revised 07 Dec 2005. [Downloadable!]
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