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Sectoral Restructuring and Labor Mobility: A Comparative Look at the Czech Republic

  • Vit Sorm
  • Katherine Terrell

Labor mobility is crucial for an efficient allocation of resources and the transition economies are often viewed as suffering from inadequate reallocation of labor. Using quarterly micro data for the 1994-1998 period, we provide a comparative analysis of the extent and determinants of labor mobility in the Czech Republic. We show there has been significant movement into the finance, trade, and tourism sectors and out of the agricultural and industrial sectors. Over half of the people who change jobs have changed sector of employment, and this restructuring has been carried out relatively efficiently in that it occurred with lower incidence and duration of unemployment than in the other transition economies. The demographic characteristics of different patterns of mobility are similar across these transition economies: we identify younger people in general and single men as individuals who more likely to change jobs or become unemployed. The more educated are experiencing more job stability and are more likely to be hired if unemployed or out of the labor force. Finally, we find in the Czech Republic, the flows between employment and unemployment are very responsive to demand conditions. Hence, we conclude that the Czech labor market is demonstrating flexibility and efficiency in the transition

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Paper provided by William Davidson Institute at the University of Michigan in its series William Davidson Institute Working Papers Series with number 273.

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Length: pages
Date of creation: 01 Nov 1999
Date of revision:
Handle: RePEc:wdi:papers:1999-273
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  1. Devine, Theresa J. & Kiefer, Nicolas M., 1991. "Empirical Labor Economics: The Search Approach," OUP Catalogue, Oxford University Press, number 9780195059366, March.
  2. Mark C. Foley, 1997. "Labor Market Dynamics in Russia," Working Papers 780, Economic Growth Center, Yale University.
  3. Alan Krueger & Jorn-Steffen Pischke, 1992. "A Comparative Analysis of East and West German Labor Markets: Before and After Unification," Working Papers 686, Princeton University, Department of Economics, Industrial Relations Section..
  4. L Bellmann & S Estrin & H Lehmann & Jonathan Wadsworth, 1992. "The Eastern German Labour Market in Transition: Gross Flow Estimates from Panel Data," CEP Discussion Papers dp0102, Centre for Economic Performance, LSE.
  5. Petrongolo, Barbara, 2001. "Reemployment Probabilities and Returns to Matching," Journal of Labor Economics, University of Chicago Press, vol. 19(3), pages 716-41, July.
  6. 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.
  7. Swati Basu & Saul Estrin & Jan Svejnar, 2000. "Employment and Wages in Enterprises Under Communism and in Transition: Evidence From Central Europe and Russia," William Davidson Institute Working Papers Series 440, William Davidson Institute at the University of Michigan.
  8. John S. Earle, 1997. "Industrial Decline and Labor Reallocation in Romania," William Davidson Institute Working Papers Series 118, William Davidson Institute at the University of Michigan.
  9. John Ham & Jan Svejnar & Katherine Terrell, 1998. "Unemployment and the Social Safety Net During Transitions to a Market Economy: Evidence from the Czech and Slovak Republic," William Davidson Institute Working Papers Series 169, William Davidson Institute at the University of Michigan.
  10. Foley, M.C., 1997. "Labor Market Dynamics in Russia," Papers 780, Yale - Economic Growth Center.
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