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Individual Pay and Outside Options: Evidence from the Polish Labour Force Survey

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  • Fiona Duffy
  • Patrick Paul Walsh

Abstract

Using Polish Labour Force Survey data, we examine whether competition for labour has induced individual pay to depend on outside options, availability and quality of jobs. Exploiting the lack of inter-regional job and worker flows we estimate the elasticity of individual pay, amongst a rich set of individual characteristics, to be approximately -0.1 for local unemployment (job shortages) and + 0.1 for local job reallocation (restructuring). Variations in local labour market conditions explain approximately 50 per cent of the differences in expected individual earnings across regions, while differences in inherited human capital and occupation structures explain the rest.

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  • Fiona Duffy & Patrick Paul Walsh, 2000. "Individual Pay and Outside Options: Evidence from the Polish Labour Force Survey," William Davidson Institute Working Papers Series 364, William Davidson Institute at the University of Michigan.
    • Handle: RePEc:wdi:papers:2001-364
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    Cited by:

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    3. Baltagi, Badi H. & Rokicki, Bartlomiej, 2013. "The Polish Wage Curve: Micro Panel Data Analysis Based on the Polish Labor Force Survey," IZA Discussion Papers 7812, Institute of Labor Economics (IZA).
    4. Peter Huber & Iulia Traistaru, 2003. "Regionale Entwicklung und Anpassung des Arbeitsmarktes in Ost-Mitteleuropa," WIFO Monatsberichte (monthly reports), WIFO, vol. 76(11), pages 841-850, November.
    5. Myck, Michal & Nici?ska, Anna & Morawski, Leszek, 2009. "Count Your Hours: Returns to Education in Poland," IZA Discussion Papers 4332, Institute of Labor Economics (IZA).
    6. Iara, Anna & Traistaru, Iulia, 2004. "How flexible are wages in EU accession countries?," Labour Economics, Elsevier, vol. 11(4), pages 431-450, August.
    7. Baltagi, Badi H. & Rokicki, Bartlomiej, 2014. "The spatial Polish wage curve with gender effects: Evidence from the Polish Labor Survey," Regional Science and Urban Economics, Elsevier, vol. 49(C), pages 36-47.
    8. Tomasz Mickiewicz & Kate Bishop, 2003. "Wage Determination: Privatised, New Private And State Owned Companies. Empirical Evidence From Panel Data," William Davidson Institute Working Papers Series 584, William Davidson Institute at the University of Michigan.
    9. Pierella Paci & Erwin R. Tiongson & Mateusz Walewski & Jacek Liwinski & Maria M. Stoilkova, 2007. "Internal Labor Mobility in Central Europe and the Baltic Region," World Bank Publications - Books, The World Bank Group, number 6598, December.
    10. Janos Kollő & Tomasz Mickiewicz, 2005. "Wage Bargaining, Privatisation, Ability to Pay and Outside Options: Evidence from Hungary," Post-Communist Economies, Taylor & Francis Journals, vol. 17(4), pages 465-483.
    11. Ruta Aidis & Kate Bishop & Sjef Ederveen & Jan Fidrmuc & Jana P. Fidrmuc & Janos Köllö & Tomasz Mickiewicz & Almos Telegdy & Laura Thissen, 2004. "Wage and Employment Decisions of Enterprises in Downsized Industries," WIFO Studies, WIFO, number 25287, Juni.
    12. Vera A. Adamchik & Thomas J. Hyclak, 2013. "The Evolution Of Regional Wage Differentials In A Transition Economy: Evidence From Poland," Global Journal of Business Research, The Institute for Business and Finance Research, vol. 7(5), pages 1-13.
    13. Mickiewicz, Tomasz & Gerry, Christopher J. & Bishop, Kate, 2005. "Privatisation, corporate control and employment growth: Evidence from a panel of large Polish firms, 1996-2002," Economic Systems, Elsevier, vol. 29(1), pages 98-119, March.
    14. Zillmer, Sabine, 2003. "Regional Structural Developments in Selected Polish Regions," IRS Working Papers 20, Leibniz Institute for Research on Society and Space (IRS).
    15. David G. Blanchflower & Andrew J. Oswald, 2005. "The Wage Curve Reloaded," NBER Working Papers 11338, National Bureau of Economic Research, Inc.
    16. Tomasz Marek Mickiewicz & Christopher Gerry & Kate Bishop, 2004. "Inherited labour hoarding, insiders and employment growth. Panel data results: Poland, 1996-2002," UCL SSEES Economics and Business working paper series 37, UCL School of Slavonic and East European Studies (SSEES).
    17. Thiess Büttner & Peter Huber & Anna Iara & Johannes Rincke & Iulia Traistaru, 2004. "AccessLab: Regional Labour Market Adjustments in the Accession Candidate Countries. Materials No 1," WIFO Studies, WIFO, number 25284, Juni.
    18. 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.
    19. Thiess Büttner & Vera Gács & Peter Huber & Anna Iara & Iulia Traistaru & Guntram Wolff, 2003. "Adjustment Capability of Regional Labour Markets," WIFO Studies, WIFO, number 24616, Juni.

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    JEL classification:

    • J6 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers
    • L0 - Industrial Organization - - General
    • O5 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies

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