Advanced Search
MyIDEAS: Login

The impact of trade liberalisation on adjustment of regional wages in Estonia

Contents:

Author Info

  • Grigori Fainstein

    ()

Registered author(s):

    Abstract

    The purpose of this paper is twofold. First, we aim at analysing the development of regional specialisation in Estonia since the beginning of trade liberalisation and integration into the EU in the early 1990s. Second, given the patterns of developments in specialisation, we analyse how trade liberalisation has affected structure of regional wages. The main data used in this study consist of a panel of 5 geographic regions aggregated at the NUTS3 level by the EU classification. For every region we calculated indices of regional industrial specialisation in 1990-2002. The indices are based on data for employment in manufacturing industries classified by two-digit NACE standard (total of 13 industries). The impact of integration with EU on regional development is based on the data for average wages in industry in regions at NUTS IV level (15 administrative units of Estonia). The analysis of industrial specialisation in Estonian NUTS III regions showed that the level of specialisation has increased on average by 1-1.5% a year. As for transition economy time is a fair proxy to integration, we may conclude that initial stages of establishing closer economic relations with EU and voluminous target investments into the regions stimulated specialisation. Econometric analysis of relationship between relative regional wages and distance to the capital suggests an explanation consistent with new economic geography hypothesis. Surprisingly, in spite of small size of Estonian territory, distance have essensial effect on variations in regional wages. Our estimates show that integration with EU and trade liberalisation minimises negative impact of distance.

    Download Info

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
    File URL: http://www-sre.wu-wien.ac.at/ersa/ersaconfs/ersa05/papers/240.pdf
    Download Restriction: no

    Bibliographic Info

    Paper provided by European Regional Science Association in its series ERSA conference papers with number ersa05p240.

    as in new window
    Length:
    Date of creation: Aug 2005
    Date of revision:
    Handle: RePEc:wiw:wiwrsa:ersa05p240

    Contact details of provider:
    Postal: Welthandelsplatz 1, 1020 Vienna, Austria
    Web page: http://www.ersa.org

    Related research

    Keywords:

    This paper has been announced in the following NEP Reports:

    References

    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.:
    as in new window
    1. Michael Devereux & Rachel Griffith & Helen Simpson, 1999. "The geographic distribution of production activity in the UK," IFS Working Papers W99/26, Institute for Fiscal Studies.
    2. Gordon H. Hanson, 1994. "Localization Economies, Vertical Organization and Trade," NBER Working Papers 4744, National Bureau of Economic Research, Inc.
    3. Martin Hallet, 1998. "The regional impact of the single currency," ERSA conference papers ersa98p27, European Regional Science Association.
    Full references (including those not matched with items on IDEAS)

    Citations

    Lists

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    Statistics

    Access and download statistics

    Corrections

    When requesting a correction, please mention this item's handle: RePEc:wiw:wiwrsa:ersa05p240. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Gunther Maier).

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.