The Vintage Effect on the Russian Labor Market

Gleb Borisov

Eastern European Economics, 2007, vol. 45, issue 2, 23-51

Abstract: The study raises the problem of nonrandom distribution of unobservable skills across the population of a transition country. At the beginning of transition, people who grew up under different political regimes have different goals, moral norms, tastes, behavioral patterns, and motivation, resulting in earnings depending on cohort. Cohort effects are separated in two ways. In the first way, the logarithm of the real wages index is used to proxy the current period. The second way is based on an assumption about the form of age-earnings profiles in Russia. The results reveal the strong and robust relationship between earnings and cohort in Russia. Conditioning of the cohort effects on gender has been discovered as well.

Date: 2007
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