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Productivity, Employment and Labor Demand in Polish Industry in the 1980s: Some Preliminary Results from Enterprise-Level Data


  • Lehmann, Hartmut
  • Schaffer, Mark E


The paper uses annual data from a panel of 334 Polish industrial enterprises over the period 1983-88 to test empirically a simple neoclassical approach to the socialist labor market. First, an enterprise production function is estimated. The paper finds that for most enterprises, the resulting estimated marginal product of labor exceeds the wage paid by the enterprise by a considerable margin, suggesting general excess demand for labor. The paper then looks at how the difference between the MPL and the wage is related to the rate of change of employment, and finds that firms where the MPL is higher than the wage - firms which in a neoclassical model would have a large excess demand for labor - do not shed labor any more slowly than other firms. Copyright 1995 by Kluwer Academic Publishers

Suggested Citation

  • Lehmann, Hartmut & Schaffer, Mark E, 1995. "Productivity, Employment and Labor Demand in Polish Industry in the 1980s: Some Preliminary Results from Enterprise-Level Data," Economic Change and Restructuring, Springer, vol. 28(1), pages 1-27.
  • Handle: RePEc:kap:ecopln:v:28:y:1995:i:1:p:1-27

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    References listed on IDEAS

    1. Munk, Knud Jorgen, 1978. " Optimal Taxation and Pure Profit," Scandinavian Journal of Economics, Wiley Blackwell, vol. 80(1), pages 1-19.
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    Cited by:

    1. Lehmann, Hartmut & Wadsworth, Jonathan, 2000. "Tenures That Shook the World: Worker Turnover in Russia, Poland, and Britain," Journal of Comparative Economics, Elsevier, vol. 28(4), pages 639-664, December.
    2. Konings, Jozef & Lehmann, Hartmut & Schaffer, Mark E., 1996. "Job creation and job destruction in a transition economy: Ownership, firm size, and gross job flows in Polish manufacturing 1988-1991," Labour Economics, Elsevier, vol. 3(3), pages 299-317, October.

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