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Labor Market Performance in Transition: The Experience of Central and Eastern European Countries

Author

Listed:
  • Mr. Philippe Egoume Bossogo
  • Mr. Jerald A Schiff
  • Ms. Miho Ihara
  • Mr. Tetsuya Konuki
  • Ms. Kornelia Krajnyak

Abstract

More than a decade after the start of the transition process, unemployment rates remain in the double digits in a number of Central and Eastern European countries. That unemployment rates have failed to decline, even in countries experiencing good growth, is puzzling. In this paper the authors examine three interrelated questions: How has the transition from central planning to market economies affected labor market performance? How have labor market institutions and policies influenced developments? Why have regional differences in unemployment persisted? The authors take an eclectic methodological approach: construction of a new data set and a simple analytical model; econometric estimation; and case studies. They find that faster-performing countries have better unemployment records; that labor market policies have some, but not dominant, influence over labor market outcomes; that policies not typically viewed as labor market policies can nevertheless significantly affect labor markets; and that market processes cannot be relied on to eliminate regional differences in unemployment.

Suggested Citation

  • Mr. Philippe Egoume Bossogo & Mr. Jerald A Schiff & Ms. Miho Ihara & Mr. Tetsuya Konuki & Ms. Kornelia Krajnyak, 2006. "Labor Market Performance in Transition: The Experience of Central and Eastern European Countries," IMF Occasional Papers 2006/004, International Monetary Fund.
    • Handle: RePEc:imf:imfops:2006/004
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    Citations

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    Cited by:

    1. Mr. Martin Cihak & Mr. Wim Fonteyne, 2009. "Five Years After: European Union Membership and Macro-Financial Stability in the New Member States," IMF Working Papers 2009/068, International Monetary Fund.
    2. Marukawa, Tomoo, 2017. "Regional unemployment disparities in China," Economic Systems, Elsevier, vol. 41(2), pages 203-214.
    3. Cuestas, Juan C. & Gil-Alana, Luis A. & Staehr, Karsten, 2011. "A further investigation of unemployment persistence in European transition economies," Journal of Comparative Economics, Elsevier, vol. 39(4), pages 514-532.
    4. Vladimir Gligorov & Anna Iara & Michael Landesmann & Robert Stehrer & Hermine Vidovic, 2008. "Western Balkan Countries: Adjustment Capacity to External Shocks, with a Focus on Labour Markets," wiiw Research Reports 352, The Vienna Institute for International Economic Studies, wiiw.
    5. Alberto Behar, 2009. "Tax Wedges, Unemployment Benefits and Labour Market Outcomes in the New EU Members," Czech Economic Review, Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies, vol. 3(1), pages 069-092, March.
    6. Hammermann, Felix, 2007. "Nonmonetary Determinants of Inflation in Romania: A Decomposition," Kiel Working Papers 1322, Kiel Institute for the World Economy (IfW Kiel).

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