Private Returns to Human Capital Over Transition: A Case Study of Belarus

40 Pages Posted: 22 Nov 2004

See all articles by Francesco Pastore

Francesco Pastore

Seconda Università di Napoli - Dipartimento di Discipline Giuridiche ed Economiche Italiane Europee e Comparate; IZA Institute of Labor Economics

Alina Verashchagina

University of Rome "La Sapienza"

Date Written: November 2004

Abstract

The gradualist approach to economic transition in Belarus would contribute to form the a priori expectation that the rate of return to education is low and the earnings profile by work experience flat, like they supposedly were under central-planning. However, the first available estimates of Mincerian earnings equations based on the Belarusian Household Survey on Incomes and Expenditure suggest that the skill payoff was high in 1996, at about 10.1% per year, and stable. The return to one year of work experience is also high at 5%. This result maintains also after controlling for sample selection bias, despite a general reduction in the annual rate of return to education by about 20-30%. Though, it is ambiguous whether the high-skill payoff is the consequence of market forces coming into play or of policy decisions, considering the pervasive role of the state in the process of wage determination.

Keywords: educational economics, returns to human capital, economic transition, Belarus

JEL Classification: J31, P52

Suggested Citation

Pastore, Francesco and Verashchagina, Alina, Private Returns to Human Capital Over Transition: A Case Study of Belarus (November 2004). Available at SSRN: https://ssrn.com/abstract=624065

Francesco Pastore (Contact Author)

Seconda Università di Napoli - Dipartimento di Discipline Giuridiche ed Economiche Italiane Europee e Comparate ( email )

Via Antonio Vivaldi, 43
Caserta CE, Caserta 81100
Italy

HOME PAGE: http://www.giurisprudenza.unina2.it/news.php?nid=185

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Alina Verashchagina

University of Rome "La Sapienza" ( email )

Italy

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
80
Abstract Views
1,028
rank
365,773
PlumX Metrics