The Wage Effects of Schooling under Socialism and in Transition: Evidence from Romania, 1950-2000

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. www.econstor.eu Keywords: returns to schooling, human capital, education, wage differentials, transition, Romania Terms of use: Documents in EconStor may AbstractWe estimate the impact of schooling on monthly earnings from 1950 to 2000 in Romania. Nearly constant at about 3-4% during the socialist period, the coefficient on schooling in a conventional earnings regression rises steadily during the 1990s, reaching 8.5% by 2000. Our analysis finds little evidence for either the standard explanations of such an increase in the West (labor supply movements, product demand shifts, technical change) or the transition-specific accounts sometimes offered (wage liberalization, border opening, increased quality of education). But we find some support for institutional and organizational explanations, particularly the high productivity of education in restructuring and entrepreneurial activities in a disequilibrium environment.

Industrial decline and labor reallocation in a transforming economy: Romania in early transition

“…For more analysis of the ILO categories in Romanian LFS data, with comparisons to Estonia and Russia, see Brown et al (2006). 6 Andren et al Andren et al (2005) study the changing impact of education on earnings in Romania from 1950 to 2000. See also Earle and Pauna (1998).…”

Economic Crisis and Wage Divergence: Empirical Evidence from Romania

“…The increase in wage inequality that started during the transition years and continued thereafter had been explained in the literature by factors such as the improved quality of the workforce due to sharp increase of enrolments in the higher education after 1989 (Skoufi as, 2003). In the same register, Andrén et al (2005) assessed the wage impact of schooling for Romanian workers, comparing the central planning period to the transition years, and found that the schooling wage premium, which was low under central planning, become more than double by 2000. Since the early 1990s, wages were set at the fi rm level, in better accordance to the employees' skills, thus producing a sizeable increase in wage inequality.…”

The Romanian Judicial Professions Database: An Open-Source Tool for Researching the Romanian Legal System

“…We also know that returns to education (i.e. the extent to which a person's wage depends on their total years of schooling) in Romania have increased significantly since the end of socialism, as schooling has become more valuable (Andrén, Earle, and Săpătoru 2005). Nevertheless, clear findings about class production and reproduction remain elusive (Tomescu-Dubrow 2006).…”