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Labor Market Uncertainty and Private Sector Labor Supply in Russia

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  • Steven Stillman

Abstract

The development of a vibrant private sector has been one of the key failures of the transitional period in Russia. This paper develops a theoretical and empirical model of individual labor supply behavior under uncertainty, and estimates this model using data from the Russian Longitudinal Monitoring Survey for the years 1994 - 1996 & 1998. As hypothesized, a decrease in private sector earnings variability is estimated to increase the likelihood of private sector employment for individuals with constrained consumption smoothing ability. Evidence of ex-ante intra-household risk sharing is also found with individuals reducing their exposure to uncertainty by diversifying the portfolio of jobs held by their household.

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Bibliographic Info

Paper provided by William Davidson Institute at the University of Michigan in its series William Davidson Institute Working Papers Series with number 359.

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Length: pages
Date of creation: 01 Nov 2000
Date of revision:
Handle: RePEc:wdi:papers:2000-359

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Keywords: Private sector; labor supply; Russia; uncertainty; intra-household;

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Cited by:
  1. Sònia Muñoz, 2006. "Wealth Effects in Europe," IMF Working Papers 06/30, International Monetary Fund.
  2. Steven Stillman, 2000. "The Determinants of Private and Government Sector Earnings in Russia," Working Papers, RAND Corporation Publications Department 00-17, RAND Corporation Publications Department.

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