Does Privatization Hurt Workers? Lessons from Comprehensive Manufacturing Firm Panel Data in Hungary, Romania, Russia, and Ukraine
J. David Brown (),
John Earle () and
No 05-125, Upjohn Working Papers and Journal Articles from W.E. Upjohn Institute for Employment Research
We estimate the effects of privatization on firm-level wages and employment in four transition economies. Applied to longitudinal data on manufacturing firms, our fixed effect and random trend models consistently fail to support workers' fears of job losses from privatization, and they never imply large negative effects on wages; only for domestic privatization in Hungary and Russia are small (3-5%) negative wage effects found. Privatization to foreign investors has positive estimated impacts on both employment and wages in all four countries. The negligible consequences of domestic privatization for workers result from effects on scale, productivity, and costs that are large but offsetting in Hungary and Romania, and from small effects of all types in Russia and Ukraine. The positive employment outcome under foreign ownership results from a substantial scale-expansion effect that dominates the productivity-improvement effect, and the positive wage outcome from a productivity effect that dominates the effect on cost reduction.
Keywords: privatization; employment; wages; foreign ownership; Hungary; Romania; Russia; Ukraine (search for similar items in EconPapers)
JEL-codes: D21 G34 J23 J31 L33 P31 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cis, nep-cwa, nep-fin, nep-pbe and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations View citations in EconPapers (7) Track citations by RSS feed
Downloads: (external link)
http://research.upjohn.org/cgi/viewcontent.cgi?art ... ext=up_workingpapers (application/pdf)
This material is copyrighted. Permission is required to reproduce any or all parts.
Working Paper: Does Privatization Hurt Workers? Lessons from Comprehensive Manufacturing Firm Panel Data in Hungary, Romania, Russia and Ukraine (2006)
Working Paper: Does Privatization Hurt Workers? Lessons from Comprehensive Manufacturing Firm Panel Data in Hungary, Romania, Russia, and Ukraine (2005)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:upj:weupjo:05-125
Access Statistics for this paper
More papers in Upjohn Working Papers and Journal Articles from W.E. Upjohn Institute for Employment Research 300 S. Westnedge Ave. Kalamazoo, MI 49007 USA. Contact information at EDIRC.
Bibliographic data for series maintained by ().