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Private returns to human capital over transition: A case study of Belarus

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  • Pastore, Francesco
  • Verashchagina, Alina

Abstract

The gradualist approach to economic transition in Belarus would contribute to form the a priori expectation that the rate of return to education is low and the earnings profile by work experience flat, like they supposedly were under central-planning. However, the first available estimates of Mincerian earnings equations based on the Belarusian Household Survey on Incomes and Expenditure suggest that the skill payoff was high in 1996, at about 10.1% per year, and stable. The return to one year of work experience is also high at 5%. This result maintains also after controlling for sample selection bias, despite a general reduction in the annual rate of return to education by about 20-30%. Though, it is ambiguous whether the high-skill payoff is the consequence of market forces coming into play or of policy decisions, considering the pervasive role of the state in the process of wage determination.
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  • Pastore, Francesco & Verashchagina, Alina, 2006. "Private returns to human capital over transition: A case study of Belarus," Economics of Education Review, Elsevier, vol. 25(1), pages 91-107, February.
    • Handle: RePEc:eee:ecoedu:v:25:y:2006:i:1:p:91-107
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    Cited by:

    1. Joanna Tyrowicz & Lucas van der Velde, 2017. "When the opportunity knocks: large structural shocks and gender wage gaps," GRAPE Working Papers 2, GRAPE Group for Research in Applied Economics.
    2. Maksim Yemelyanau, 2009. "Inequality in Belarus from 1995 to 2007," BEROC Working Paper Series 01, Belarusian Economic Research and Outreach Center (BEROC).
    3. repec:spr:jlabre:v:38:y:2017:i:2:d:10.1007_s12122-017-9242-y is not listed on IDEAS
    4. repec:wsi:ijitmx:v:15:y:2018:i:04:n:s0219877018500335 is not listed on IDEAS
    5. Sanghamitra Kanjilal-Bhaduri & Francesco Pastore, 2018. "Returns to Education and Female Participation Nexus: Evidence from India," The Indian Journal of Labour Economics, Springer;The Indian Society of Labour Economics (ISLE), vol. 61(3), pages 515-536, September.
    6. Raslavičius, Laurencas, 2012. "Renewable energy sector in Belarus: A review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 16(7), pages 5399-5413.
    7. Karolina Goraus & Joanna Tyrowicz & Lucas van der Velde, 2017. "How (Not) to make women work?," GRAPE Working Papers 1, GRAPE Group for Research in Applied Economics.
    8. Kanjilal-Bhaduri, Sanghamitra & Pastore, Francesco, 2018. "Returns to Education and Female Work Force Participation Nexus: Evidence from India," GLO Discussion Paper Series 162, Global Labor Organization (GLO).
    9. Strawinski, Pawel, 2007. "Changes In Return To Higher Education In Poland 1998-2004," MPRA Paper 5185, University Library of Munich, Germany.
    10. Tjaša Bartolj & Aleš AhCan & Aljoša Feldin & Sašo Polanec, 2013. "Evolution of private returns to tertiary education during transition: evidence from Slovenia," Post-Communist Economies, Taylor & Francis Journals, vol. 25(3), pages 407-424, September.
    11. Searing, Elizabeth A.M. & Rios-Avila, Fernando & Lecy, Jesse D., 2013. "The impact of psychological trauma on wages in post-conflict Bosnia and Herzegovina," Social Science & Medicine, Elsevier, vol. 96(C), pages 165-173.
    12. Alexander Chubrik & Alaksei Kazlou, 2013. "Costs and Benefits of Labour Mobility between the EU and the Eastern Partnership Partner Countries. Country report: Belarus," CASE Network Studies and Analyses 0462, CASE-Center for Social and Economic Research.
    13. Tom Coupe & Hanna Vakhitova, 2011. "Recent Dynamics of Returns to Education in Transition Countries," Discussion Papers 39, Kyiv School of Economics.
    14. Arabsheibani, Reza & Mussurov, Altay, 2006. "Returns to Schooling in Kazakhstan: OLS and Instrumental Variables Approach," IZA Discussion Papers 2462, Institute of Labor Economics (IZA).
    15. Karolina Goraus & Joanna Tyrowicz, 2013. "The Goodwill Effect? Female Access to the Labor Market Over Transition: A Multicountry Analysis," Working Papers 2013-19, Faculty of Economic Sciences, University of Warsaw.
    16. El-hadj Bah & Josef C. Brada, 2014. "Labor Markets in the Transition Economies: An Overview," European Journal of Comparative Economics, Cattaneo University (LIUC), vol. 11(1), pages 3-53, June.
    17. CHEN, Guifu & HAMORI, Shigeyuki, 2009. "Economic returns to schooling in urban China: OLS and the instrumental variables approach," China Economic Review, Elsevier, vol. 20(2), pages 143-152, June.
    18. Amarjargal DAIRII & Terukazu SURUGA, 2006. "Economic Returns to Schooling in Transition: A Case of Mongolia," GSICS Working Paper Series 9, Graduate School of International Cooperation Studies, Kobe University.
    19. repec:sgh:gosnar:y:2009:i:5-6:p:39-60 is not listed on IDEAS
    20. Danilovich, Hanna & Croucher, Richard, 2015. "Investment in personnel and FDI in Belarusian companies," International Business Review, Elsevier, vol. 24(6), pages 966-971.
    21. Strawinski, Pawel, 2008. "External Return to Education in Poland," MPRA Paper 11598, University Library of Munich, Germany.
    22. Pastore Francesco & Verashchagina Alina, 2007. "The gender wage gap in the Republic of Belarus," EERC Working Paper Series 04-133e, EERC Research Network, Russia and CIS.
    23. Tamar Khitarishvili, 2010. "Assessing the Returns to Education in Georgia," Economics Working Paper Archive wp_608, Levy Economics Institute.
    24. Phanhpakit ONPHANHDALA & Terukazu SURUGA, 2007. "Education and Earnings in Lao PDR: Further Results," GSICS Working Paper Series 16, Graduate School of International Cooperation Studies, Kobe University.
    25. Strawinski, Pawel, 2008. "Changes in return to higher education in Poland 1998-2005," MPRA Paper 9533, University Library of Munich, Germany.

    More about this item

    JEL classification:

    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • P52 - Economic Systems - - Comparative Economic Systems - - - Comparative Studies of Particular Economies

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