«women in transition: changes in gender wage differentials in eastern europe and the former soviet...

«Women in transition: changes in gender

wage differentials in Eastern Europe and the former Soviet

Union»

Elizabeth Brainerd

Political Economy of Transition

Lorena CanteriniSopio GogsadzeLiucija Zaksaite

MA MIREES

Elizabeth Brainerd

• HARVARD UNIVERSITYPh.D., Economics, November 1996. Fields: labor economics, public economics.

• DEPARTMENT OF ECONOMICS, BRANDEIS UNIVERSITY

Susan and Barton Winokur Professor of Economics and Women’s and Gender Studies, 2009- present.

Women in transition: changes in gender wage differentials in Eastern

Europe and the former Soviet Union

Outline

Conclusion

Changes in female employment and labour force participation

Decomposing the change in the female-male wage differential

Empirical Results

Factors

Market reforms and changing labour market institutions in the early 1990s

Under Socialism

Introduction



Introduction How have women in formerly socialist

countries been affected by the introduction of market reforms?

Is the introduction of market reforms in these countries a gender-neutral policy?

Comparing surveys for each country before and after the initial period of reforms 1 or 2 years of

market reforms



Under SocialismLabour Market

Institutions• Soviet model• Occupational wage

scale• Bonuses for plan

fulfilment• Unemployment was

not recognised • Limited mobility ( Internal passport)• Excess demand for

labour ( soft budget constraints and plan fulfilment)

Economic Status of Women

Rapid growth

• Intense industrialization

• 80% of female working-age population

• Relatively equal labour market outcomes for men and women

• BUT double burden of market and non-market work



Market Reforms and Changing Labor Market Institutions in the early

1990s Different experiences according to countries

Wage-setting system change: FSU: Decentralized plant-level negotiations EECs: collective bargaining

Minimum Wage: (changes in the real value of the minimum wage will affect women’s wage more than men’s, as women have lower wages on average) Russia and Ukraine: eroded by inflation EECs: much higher



Factors

1. Changes in the overall wage structure (e. g.

skills)

2. Changes in gender-specific

factors (e. g. discrimination)

Return to education is favourable for

women increase female wages

Employers facing hard budget constraints

women as high cost labour (maternity

leaves and child care benefits)

Women in transition: changes in gender wage differentials in

Eastern Europe and the former Soviet Union

Empirical Results



Decomposing the change in the female-male wage

differential

Observed X’s (i. e. level of education and years

of work experience)

Observed prices

Gap Unobserved

prices

4 effects:

Women in transition: changes in gender wage differentials in

Eastern Europe and the former Soviet Union

Substantial differences between

Russia and Ukraine and

EECs

Changes in female employment and labour force participation

Shift in the occupational and industrial distribution of employment («man-power» index)

Demand and supply shifts Labour market discrimination

(hypotesis): EECs: discrimination eroded by the forces of

competition Russia and Ukraine: women may benefit from

continued de-monopolization and liberalization of those economies



Conclusion

EECs:

Beneficial in

comparison with men

Facing less labour market

discrimination

Russia and Ukraine:

Increase in inequality

Lack of an effective

minimum wage

In both groups of countries, market reforms have benefited women in many ways outside the labour market (i. e.

availability of goods and services).



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