The Wage and Non-wage Costs of Displacement: Evidence from Russia

This paper is the first to analyze the costs of job loss in Russia, using unique new data from the Russian Longitudinal Monitoring Survey over the years 2003-2008, including a special supplement on displacement that was initiated by us. We employ fixed effects regression models and propensity score matching techniques in order to establish the causal effect of displacement for displaced individuals. The paper is innovative insofar as we investigate fringe and in-kind benefits and the propensity to have an informal employment relationship as well as a permanent contract as relevant labor market outcomes upon displacement. We also analyze monthly earnings, hourly wages, employment and hours worked, which are traditionally investigated in the literature. Compared to the control group of non-displaced workers (i.e. stayers and quitters), displaced individuals face a significant income loss following displacement, which is mainly due to the reduction in employment and hours worked. This effect is robust to the definition of displacement. The losses seem to be more pronounced and are especially large for older workers with labor market experience and human capital acquired in Soviet times and for workers with primary and secondary education. Workers displaced from state firms experience particularly large relative losses in the short run, while such losses for workers laid off from private firms are more persistent. Turning to the additional non-conventional labor market outcomes, there is a loss in terms of the number of fringe and in-kind benefits for reemployed individuals but not in terms of their value. There is also some evidence of an increased probability of working in informal jobs if displaced. These results point towards the importance of both firm-specific human capital and of obsolete skills obtained under the centrally planned economy as well as to a wider occurrence of job insecurity among displaced workers

The transition of people’s preferences for the intervention of the government in the economy of re-unified Germany

Covering the first fifteen years immediately after German re- unification, this paper analyzes the people’s support to the transition. The focus is on individuals’ preferences for the intervention of the government in the economy and on the opinion about competition per se. Eastern German data are compared with Western German data. Using suitable data that allow for interpersonal comparisons, the paper shows that Eastern Germans have always preferred an intervention of the public hand in the economy deeper than Western Germans; these different positions have hardly converged during the examined period of time. However there are no significant differences with respect to how Germans perceive competition per se: it is considered as a good by the people living in both parts of the country.info:eu-repo/semantics/publishedVersio