Earnings Inequality and Transition: A Regional Analysis of Poland

Sibley, Christopher W.; Walsh, Patrick Paul

doi:10.2139/ssrn.300661

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Earnings Inequality and Transition: A Regional Analysis of Poland

22 Pages Posted: 16 Feb 2002

See all articles by Christopher W. Sibley

Christopher W. Sibley

Trinity College (Dublin) - Department of Economics

Patrick Paul Walsh

UCD; Institute for the Study of Labor (IZA)

Date Written: February 2002

Abstract

In this paper we estimate the impact of transition on earnings inequality using data across Polish regions 1994-1997. Our central result is that earnings inequality is higher in regions that are more advanced in restructuring (higher labor productivity/job reallocation rates), controlling for unobservable regional fixed effects. At the national level rapid growth does not seem to be associated with earnings inequality. This aggregate relationship is shown to be misleading. The positive relationship between earnings inequality and the stage of transition across regions remains when we apply an infrastructure-deficit based instrumental variable approach to allow for reverse causality.

Keywords: Earnings Inequality, Transition, Polish Regions

JEL Classification: D31, O15, E64, J6, J31

Suggested Citation: Suggested Citation

Sibley, Christopher W. and Walsh, Patrick Paul, Earnings Inequality and Transition: A Regional Analysis of Poland (February 2002). Available at SSRN: https://ssrn.com/abstract=300661 or http://dx.doi.org/10.2139/ssrn.300661