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Non-wage benefits, costs of turnover, and labor attachment: evidence from Russian firms

Listed author(s):
  • Tuuli Juurikkala

    ()

    (Bank of Finland Institute for Economies in Transition)

  • Olga Lazareva

    ()

    (CEFIR)

Just as in established market economies, many Russian firms provide non-wage benefits such as housing, medical care or day care to their employees. Interpreting this as a strategic choice of firms in an imperfect labor market, this paper examines unique survey data for 404 large and medium-size industrial establishments from 40 Russian regions. We find strong evidence that Russian industrial firms use social services to reduce the costs of labor turnover in the face of tight labor markets. The strongest effect is observed for blue-collar workers. We also find that the share of non-monetary compensation decreases with improved access to local social services.

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Paper provided by Center for Economic and Financial Research (CEFIR) in its series Working Papers with number w0062.

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Length: 22 pages
Date of creation: Mar 2006
Handle: RePEc:cfr:cefirw:w0062
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