The Russian-Ukrainian Earnings Divide
Institute for the Study of Labor (IZA); DIW DC
Institute for the Study of Labor (IZA); Central European University; Central European Labour Studies Institute
Klaus F. Zimmermann
Institute for the Study of Labor (IZA); German Institute for Economic Research (DIW Berlin); University of Bonn; Journal of Population Economics; Centre for Economic Policy Research (CEPR)
IZA Discussion Paper No. 2330
Ethnic differences are often considered to be powerful sources of diverse economic behavior. In this paper, we investigate whether and how ethnicity affects Ukrainian labor market outcomes. Using micro data from the Ukrainian Longitudinal Monitoring Survey (ULMS) and Oaxaca-Blinder decomposition of earnings, we find a persistent and rising labor market divide between ethnic Russians and Ukrainians throughout Ukraine's transition era. We establish that language rather than nationality is the key factor behind this ethnic premium favoring Russians. Our findings further document that this premium is larger among males than among females.
Number of Pages in PDF File: 28
Keywords: ethnicity, earnings differences, discrimination, transitional labor markets, ethnic premium
JEL Classification: J15, J70, J82working papers series
Date posted: October 15, 2006
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