Wage Structures in the Transition of the Czech Economy

Robert J. Flanagan

IMF Staff Papers, 1995, vol. 42, issue 4, 836-854

Abstract: From the perspective of market economies, central planning produced distinct distortions in the wage structures of socialist countries. This paper examines the extent to which wage structures in the state and private sectors have adjusted to remove such distortions during the economic transition, using micro data from the Czech Republic. There is strong evidence that Czech wage structures are moving toward patterns observed in market economies, and the change is being led by developments in the private sector. At the same time, the establishment of collective bargaining does not appear to be introducing countervailing distortions into Czech wage structures.

Date: 1995
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