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Earnings in Poland: The Private Versus the Public Sector

Author

Listed:
  • Jacob Weisberg

    (Bar-Ilan University)

  • Mieczslaw Waclaw Socha

    (Warsaw University)

Abstract

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.

Suggested Citation

  • Jacob Weisberg & Mieczslaw Waclaw Socha, 2002. "Earnings in Poland: The Private Versus the Public Sector," Journal of Entrepreneurial Finance, Pepperdine University, Graziadio School of Business and Management, vol. 7(3), pages 17-38, Fall.
  • Handle: RePEc:pep:journl:v:7:y:2002:i:3:p:17-38
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    References listed on IDEAS

    as
    1. Tansel, Avsit, 2005. "Public-Private Employment Choice, Wage Differentials, and Gender in Turkey," Economic Development and Cultural Change, University of Chicago Press, vol. 53(2), pages 453-477, January.
    2. Andrew Newell & Barry Reilly, 1999. "Rates of Return to Educational Qualifications in the Transitional Economies," Education Economics, Taylor & Francis Journals, vol. 7(1), pages 67-84.
    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. 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.
    5. 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.
    6. 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.
    7. 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, May.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Jelena Lausev, 2014. "WHAT HAS 20 YEARS OF PUBLIC–PRIVATE PAY GAP LITERATURE TOLD US? EASTERN EUROPEAN TRANSITIONING vs. DEVELOPED ECONOMIES," Journal of Economic Surveys, Wiley Blackwell, vol. 28(3), pages 516-550, July.
    2. Gabriela Grotkowska & Leszek Wincenciak, 2014. "Public sector wage premium in Poland: can it be explained by structural differences in employment?," Ekonomia journal, Faculty of Economic Sciences, University of Warsaw, vol. 38.
    3. repec:sgh:gosnar:y:2017:i:1:p:5-31 is not listed on IDEAS
    4. Paweł Strawiński & Agnieszka Skierska, 2016. "Public–private gap along the wage distribution in Poland," Ekonomia journal, Faculty of Economic Sciences, University of Warsaw, vol. 44.
    5. Gabriela Grotkowska & Leszek Wincenciak & Tomasz Gajderowicz, 2017. "Evolution of the Public-Sector Wage Premium in Poland," Gospodarka Narodowa, Warsaw School of Economics, issue 1, pages 5-31.
    6. Jacek Liwiński & Emilia Bedyk, 2016. "Does it pay to invest in the education of children?," Ekonomia journal, Faculty of Economic Sciences, University of Warsaw, vol. 47.
    7. Emilia Bedyk & Jacek Liwiński, 2016. "The wage premium from parents’ investments in the education of their children in Poland," Working Papers 2016-14, Faculty of Economic Sciences, University of Warsaw.

    More about this item

    Keywords

    Private Firms; Public Firms; Earnings; Poland;

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe
    • L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out

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