Assessing the Problem of Human Capital Mismatch in Transition Economies

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Assessing the Problem of Human Capital Mismatch in Transition Economies

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Viliam Druska
Byeong ju Jeong
Michal Kejak
Viatcheslav Vinogradov

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Michal Kejak

Abstract

In transition economies, there may be a significant mismatch between the types of skills that workers possess and the types of skills that the new economy demands. We consider this problem of human capital mismatch along the dimensions of training type (holding the level) and occupation. We document that in the Czech Republic and Poland the wage rate grew faster in business occupations than in technical occupations in the 1990's, and that in response the technical training/occupations contracted while the business training/occupations expanded. We do not find this pattern in Hungary. We construct a neoclassical model with endogenous occupational choice and calibrate it to the Czech and Polish data. We estimate that the discounted sum of output loss due to human capital mismatch amounts to 44% of the aggregate output of the beginning year of transition.

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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 467.

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Length: 36 pages
Date of creation: 01 Mar 2002
Date of revision:
Handle: RePEc:wdi:papers:2002-467

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Find related papers by JEL classification:
J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
J62 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Job, Occupational and Intergenerational Mobility; Promotion
P23 - Economic Systems - - Socialist Systems and Transition Economies - - - Factor and Product Markets; Industry Studies; Population
E13 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Neoclassical

This paper has been announced in the following NEP Reports:

NEP-ALL-2002-06-18 (All new papers)

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.:

Sorm, Vit & Terrell, Katherine, 2000. "Sectoral Restructuring and Labor Mobility: A Comparative Look at the Czech Republic," IZA Discussion Papers 111, Institute for the Study of Labor (IZA). [Downloadable!]
Other versions:
- Vit Sorm & Katherine Terrell, 1999. "Sectoral Restructuring and Labor Mobility: A Comparative Look at the Czech Republic," William Davidson Institute Working Papers Series 273, William Davidson Institute at the University of Michigan Stephen M. Ross Business School. [Downloadable!]
- Sorm, Vit & Terrell, Katherine, 2000. "Sectoral Restructuring and Labor Mobility: A Comparative Look at the Czech Republic," Journal of Comparative Economics, Elsevier, vol. 28(3), pages 431-455, September. [Downloadable!] (restricted)
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Other versions:
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- Acemoglu, Daron & Zilibotti, Fabrizio, 1998. "Productivity Differences," Seminar Papers 660, Stockholm University, Institute for International Economic Studies. [Downloadable!]
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Tito Boeri & Christopher J. Flinn, 1999. "Returns to Mobility in the Transition to a Market Economy," William Davidson Institute Working Papers Series 217, William Davidson Institute at the University of Michigan Stephen M. Ross Business School. [Downloadable!]
Other versions:
- Boeri, Tito & Flinn, Christopher J, 1999. "Returns to Mobility in the Transition to a Market Economy," CEPR Discussion Papers 2098, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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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!]

Full references

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.)

Spagat, Michael, 2002. "Human Capital and the Future of Transition Economies," CEPR Discussion Papers 3517, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
Other versions:
- Michael Spagat, 2001. "Human Capital and the Future of Transition Economies," Royal Holloway, University of London: Discussion Papers in Economics 01/3, Department of Economics, Royal Holloway University of London, revised Dec 2001. [Downloadable!]
- Spagat, Michael, 2006. "Human capital and the future of transition economies," Journal of Comparative Economics, Elsevier, vol. 34(1), pages 44-56, March. [Downloadable!] (restricted)
Zuzana Brixiova & Vera Volchok, 2005. "Labor Market Trends and Institutions in Belarus," William Davidson Institute Working Papers Series wp777, William Davidson Institute at the University of Michigan Stephen M. Ross Business School. [Downloadable!]
Kevin Denny & Patrick Orla Doyle, 2005. "Returns to basic skills in Central and Eastern Europe - a semi-parametric approach," Working Papers 200507, School Of Economics, University College Dublin. [Downloadable!]

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