Bureaucratic Behavior: A Review of the Theory and its Application to Serbian Public Administration

A professional and competent public administration is necessary for successful transition from a socialist, centrally planned economy to a functioning market democracy. The difficulty lies in building an organized and effective civil service sector. This paper gives a brief overview of formal bureaucratic reasoning, beginning with Niskanens theory, followed by the principal-agent model. The Weberian state hypothesis, which provides an alternative view of bureaucracies in less developed countries, is subsequently explored. Finally, the currant state of Serbian public administration is described, along with a discussion of challenges to be addressed in the future.Bureaucracy, Niskanens theory, Principal-agent model, Weberian approach to bureaucratic reform, Serbian public administration

Bureaucratic behavior: A review of the theory and its application to Serbian public administration

A professional and competent public administration is necessary for successful transition from a socialist, centrally planned economy to a functioning market democracy. The difficulty lies in building an organized and effective civil service sector. This paper gives a brief overview of formal bureaucratic reasoning, beginning with Niskanen’s theory, followed by the principal-agent model. The "Weberian state hypothesis", which provides an alternative view of bureaucracies in less developed countries, is subsequently explored. Finally, the currant state of Serbian public administration is described, along with a discussion of challenges to be addressed in the future

Addressing inequality and poverty with tax instruments

There is a consensus, in both academia and economic policy circles, that the reform of the personal income tax system in Serbia is necessary one. Two frequently discussed reform scenarios are East European style flat tax and the comprehensive income tax model of Western Europe. Most Central and Eastern European (CEE) countries have recently reformed their income tax systems by introducing some form of flat tax scheme, while in numerous countries of Western Europe the possibility of flat tax reform is also seriously considered. Opponents of the reform usually stress the adverse distributional effects of flat tax schemes. The aim of our paper is to contribute to the empirical literature on the distributional effects of alternative tax reform scenarios. The analysis is based on the tax and benefit micro-simulation model for Serbia (SRMOD). The results suggest that redesigning the existing income tax system so as to introduce a uniform tax rate and increase the basic allowance would somewhat reduce inequality and improve vertical inequity in taxation. On the other hand, in the case of the introduction of comprehensive income tax, considerably larger equalizing and progressivity effects would be achieved. At the same time, since in both cases redistribution will not affect the bottom decile group, no significant effects (in either cases) on poverty reduction will be achieved

Women's access to economic opportunities in Serbia

After more than a decade of progress in building an institutional infrastructure for gender equality, the overall economic opportunities among women in Serbia still lag those among men. Women, on average, earn 86 percent of the wages of their coworkers who are men after one controls for differences in educational and job characteristics. In the labor market, women who have the same work profiles as men have similar chances to be employed; however, there are many obstacles confronting women in joining the labor market in the first place. Gender inequalities are pronounced in rural areas, where a high number of women serving as unpaid family members are deprived of the right to social security. Furthermore, the recently published Gender Equality Index ranks Serbia 12 percentage points below European Union average. The Index highlights areas where particular efforts are needed such as the domain of work, access to financial resources, and social activities (domain of time). This report focuses on better understanding the factors that influence women’s economic opportunities in particular, an area in which significant inequalities remain. Women’s economic opportunity is defined as a set of laws, regulations, and practices that allow women to participate in the workforce under conditions roughly equal to those of men, whether as wage-earning employees or as owners of businesses. As such, the report looks into the ability of women to accumulate and build-up critical endowments - education and health – and to participate in the labor market and have access to jobs. By reviewing the institutions and policies relevant to gender equality in access to economic opportunities in Serbia, the intention is also to point out necessary improvements in policies and programs that will encourage women’s participation in the workplace and thus create a more productive economy overall. The analysis mostly relies on exploiting a new dataset for Serbia, the Survey on Income and Living Conditions (SILC), together with Labor Force Survey (LFS) data. Findings show that gender equality exists in Serbia in terms of both participation in and attainment of education. Women in the prime age group have better educational characteristics than men of the same age, while the opposite holds for the older population of women. Gender educational gaps among the poor and the bottom 40 percentof the income distribution (the bottom 40) are similar in size relative to the corresponding gaps in the general population. Nevertheless, individuals living in rural areas and the Roma population are disadvantaged and tend to have larger gender educational gaps. According to our findings,in rural areas, women have lower average educational attainment. Early school leavers among women are also more likely to live in rural areas. Number of indicators, such as,the enrolment rates in secondary education, average number of years spent in education and percentage of population that can expect to complete postsecondary education, have significantly lower values among Roma than nonRoma population

Rastuća neaktivnost starije populacije na tržištu rada: posledice i moguća rešenja

Srbija je zemlja sa sve starijom populacijom i sve manjom radnom snagom. Ovo predstavlja izazov sistemu socijalne zaštite i javnim inansijama, ali takođe stvara i značajno opterećenje za ekonomski rast i može ugroziti ekonomsku dobrobit starijih pojedinaca. U radu se analiziraju trendovi na tržištu rada za stariju populaciju (55-64 godine). Učavamo glavne gruupe neaktivnih među starijim licima, njihove socio-ekonomske proile i promene koje su se dogodile tokom ekonomske krize. Kako bi se analizirale mogućnosti povećanja učešća starijeg stanovništva u skladu sa odgovarajućim indikatorima aktivnosti u EU, ovaj rad dalje razmatra ključne intervencije koje su potrebne u domenu penzione politike, sistemu poreza i doprinosa, aktivne politike tržišta rada

Labour Market Effects of Social Security Contributions Reform in Serbia

In Serbia the inactivity rate of the working-age population is close to 40%, among the highest in Europe. The country also faces a high informal employment rate of 24%. Previous research has argued that high levels of informality and inactivity are mostly due to a high effective tax wedge at low wage levels caused by a minimum base for calculation of social security contributions (SSC), sudden withdrawal of means-tested benefits once formal income is earned, and low progressivity of income tax. This paper evaluates the impact of the minimum SSC base reform scenarios on labour supply and employment formalization using tax and benefit micro-simulation models together with the structural discrete choice labour supply model based on the Survey on Income and Living Conditions Data. Although we do not find positive employment effects of the reform, it would be premature to deduce that abolishment of the minimum SSC base is not needed. At this stage in our research, until alternative labour-supply modelling is applied, with both sector and hours of work choice alternatives, it is only safe to conclude that the proposed reform will not significantly contribute to the transformation of informal full-time to formal full-time jobs

Austerity and gender wage inequality in EU countries

The great recession, and the countercyclical responses by European governments that followed, triggered an extensive wave of fiscal adjustments. The implementation of these austerity measures, although underpinned by a widespread consensus, underwent severe criticism. While their effects on output and employment have been extensively investigated, their impacts on wage inequality have received relatively less attention. In this paper we focus on the consequences of austerity measures on gender wage inequalities. After having described the literature-based conceptual framework of our analysis, we provide empirical evidence on the effects of austerity measures on: (i) the adjusted gender wage gap; and (ii) the patterns of gender horizontal segregation. The analysis covers the group of EU-28 countries in the years from 2010 to 2013. Results show that austerity measures (both tax-based and expenditure-based) impacted significantly on various sides of gender wage inequality, putting at risk the relatively little progress achieved in Europe so far

Labour Supply and Inequality Effects of In-Work Benefits: Evidence from Serbia

Low labour market participation, together with the high effective tax wedge at low wage levels, create a fertile ground for the introduction of the in-work benefits (IWB) in Serbia. Our paper provides an ex-ante evaluation of the two IWB schemes, directed at stimulating the labour supply and more equal income distribution. The methodological approach combines the tax-and-benefit microsimulation model with the discrete labour supply model. Our results show that both individual and family-based IWB schemes would considerably boost labour market participation, although family-based benefits would have disincentivizing effects for the secondary earners in couples. Most of the behavioural changes take place among the poorest individuals, with significant redistributive effects