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Earnings in Poland: The Private Versus the Public Sector

  • Jacob Weisberg

    (Bar-Ilan University)

  • Mieczslaw Waclaw Socha

    (Warsaw University)

The transition of Poland to a free market economy, concurrent to a substantial increase of the private sector, promoted entrepreneurship, joint ventures, self-employment, labor reallocation, growth of financial markets and direct foreign investments. Previous studies have provided inconclusive evidence regarding earning disparities in Poland. The present study proposes a model that employs demographic, employment and organizational characteristics, revealing that earnings in the private sector are 9.8% higher than in the public sector; human capital characteristics are more influential in the private than in the public sector; the return to general training is higher for both workers with a higher education and those in the private sector; and the return to firm-specific-training is higher in the private sector. The results are discussed in light of the structure of a transitional economy and the changing labor market.

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Article provided by Pepperdine University, Graziadio School of Business and Management in its journal Journal of Entrepreneurial Finance and Business Ventures.

Volume (Year): 7 (2002)
Issue (Month): 3 (Fall)
Pages: 17-38

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Handle: RePEc:pep:journl:v:7:y:2002:i:3:p:17-38
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  1. Andrew Newell & Mieczyslaw Socha, 1998. "Wages distribution in Poland: The roles of privatization and international trade, 1992-96," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 6(1), pages 47-65, 05.
  2. Borland, Jeff & Hirschberg, Joe & Lye, Jenny, 1998. "Earnings of Public Sector and Private Sector Employees in Australia: Is There a Difference?," The Economic Record, The Economic Society of Australia, vol. 74(224), pages 36-53, March.
  3. Keane, Michael P. & Prasad, Eswar S., 2006. "Changes in the structure of earnings during the Polish transition," Journal of Development Economics, Elsevier, vol. 80(2), pages 389-427, August.
  4. Tansel, A., 1999. "Public_Private Employment Choice, Wage Differential and Gender in Turkey," Papers 797, Yale - Economic Growth Center.
  5. Adamchik, Vera A. & Bedi, Arjun S., 2000. "Wage differentials between the public and the private sectors: evidence from an economy in transition," Labour Economics, Elsevier, vol. 7(2), pages 203-224, March.
  6. Arjun Bedi, 1998. "Sector choice, multiple job holding and wage differentials: Evidence from Poland," Journal of Development Studies, Taylor & Francis Journals, vol. 35(1), pages 162-179.
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