IDEAS home Printed from https://ideas.repec.org/p/iza/izadps/dp11342.html
   My bibliography  Save this paper

Shocked by Therapy? Unemployment in the First Years of the Socio-Economic Transition in Poland and its Long-Term Consequences

Author

Listed:
  • Myck, Michal

    (Centre for Economic Analysis, CenEA)

  • Oczkowska, Monika

    (Centre for Economic Analysis, CenEA)

Abstract

We examine long-term implications of unemployment for material conditions and well-being using the Polish sample from the Survey of Health, Ageing and Retirement in Europe (SHARE). Retrospective data from the SHARELIFE survey are used to reconstruct labour market experiences across the threshold of the socio-economic transformation from a centrally planned to a free market economy in Poland. These individual experiences are matched with outcomes observed in the survey about 20 years later to examine their correlation with unemployment at the time of the transition. We find that becoming unemployed in the early 1990s correlates significantly with income, assets and a number of measures of well-being recorded in 2007 and 2012. Using plant closures to reflect exogenous changes to labour market status at the time of the transition, we are able to confirm the causal effect of unemployment on income and house ownership 20 years later, but find no evidence for a long-term causal relationship between unemployment and such measures of well-being as life satisfaction, depression and subjective assessment of material conditions.

Suggested Citation

  • Myck, Michal & Oczkowska, Monika, 2018. "Shocked by Therapy? Unemployment in the First Years of the Socio-Economic Transition in Poland and its Long-Term Consequences," IZA Discussion Papers 11342, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp11342
    as

    Download full text from publisher

    File URL: https://docs.iza.org/dp11342.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Cavapozzi, Danilo & Garrouste, Christelle & Paccagnella, Omar, 2010. "Childhood, Schooling and Income Inequality," MPRA Paper 28729, University Library of Munich, Germany.
    2. Jacobson, Louis S & LaLonde, Robert J & Sullivan, Daniel G, 1993. "Earnings Losses of Displaced Workers," American Economic Review, American Economic Association, vol. 83(4), pages 685-709, September.
    3. Louis S. Jacobson & Robert J. LaLonde & Daniel G. Sullivan, 1993. "Long-term earnings losses of high-seniority displaced workers," Economic Perspectives, Federal Reserve Bank of Chicago, vol. 17(Nov), pages 2-20.
    4. Sergei Guriev & Ekaterina Zhuravskaya, 2009. "(Un)happiness in Transition," Journal of Economic Perspectives, American Economic Association, vol. 23(2), pages 143-168, Spring.
    5. Brugiavini, Agar & Weber, Guglielmo (ed.), 2014. "Longer-term Consequences of the Great Recession on the Lives of Europeans," OUP Catalogue, Oxford University Press, number 9780198708711.
    6. Olivier Jean Blanchard & Kenneth A. Froot & Jeffrey D. Sachs, 1994. "The Transition in Eastern Europe, Volume 1, Country Studies," NBER Books, National Bureau of Economic Research, Inc, number blan94-2, June.
    7. Giorgio Brunello & Guglielmo Weber & Christoph T. Weiss, 2017. "Books are Forever: Early Life Conditions, Education and Lifetime Earnings in Europe," Economic Journal, Royal Economic Society, vol. 127(600), pages 271-296, March.
    8. Iris Kesternich & Bettina Siflinger & James P. Smith & Joachim K. Winter, 2014. "The Effects of World War II on Economic and Health Outcomes across Europe," The Review of Economics and Statistics, MIT Press, vol. 96(1), pages 103-118, March.
    9. Blanchard, Olivier Jean, 1994. "Transition in Poland," Economic Journal, Royal Economic Society, vol. 104(426), pages 1169-1177, September.
    10. Farber, Henry S, 2011. "Job Loss in the Great Recession: Historical Perspective from the Displaced Workers Survey, 1984-2010," IZA Discussion Papers 5696, Institute of Labor Economics (IZA).
    11. Megan Beckett & Julie Da Vanzo & Narayan Sastry & Constantijn Panis & Christine Peterson, 2001. "The Quality of Retrospective Data: An Examination of Long-Term Recall in a Developing Country," Journal of Human Resources, University of Wisconsin Press, vol. 36(3), pages 593-625.
    12. repec:hal:spmain:info:hdl:2441/7fst0pcf5j8cr99e1nuobt97rn is not listed on IDEAS
    13. repec:pri:indrel:dsp01kw52j8087 is not listed on IDEAS
    14. Olivier Blanchard & Kenneth Froot & Jeffrey Sachs, 1994. "The Transition in Eastern Europe, Volume 2, Restructuring," NBER Books, National Bureau of Economic Research, Inc, number blan94-3, June.
    15. Dariusz K. Rosati, 1994. "Output decline during transition from plan to market: a reconsideration," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 2(4), pages 419-441, December.
    16. Henry S. Farber, 2011. "Job Loss in the Great Recession: Historial Perspective from the Displaced Workers Survey, 1984-2010," Working Papers 1309, Princeton University, Department of Economics, Industrial Relations Section..
    17. Blanchard, Olivier Jean & Froot, Kenneth A. & Sachs, Jeffrey D. (ed.), 1994. "The Transition in Eastern Europe, Volume 2," National Bureau of Economic Research Books, University of Chicago Press, edition 1, number 9780226056623, June.
    18. James P. Smith & Duncan Thomas, 2003. "Remembrances of things past: test–retest reliability of retrospective migration histories," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 166(1), pages 23-49, February.
    19. Olivier Jean Blanchard & Kenneth A. Froot & Jeffrey D. Sachs, 1994. "Introduction to "The Transition in Eastern Europe, Volume 1"," NBER Chapters, in: The Transition in Eastern Europe, Volume 1, Country Studies, pages 1-18, National Bureau of Economic Research, Inc.
    20. Giorgio Brunello & Guglielmo Weber & Christoph T. Weiss, 2017. "Books are Forever: Early Life Conditions, Education and Lifetime Earnings in Europe," Economic Journal, Royal Economic Society, vol. 127(600), pages 271-296, March.
    21. Blanchard, Olivier Jean & Froot, Kenneth A. & Sachs, Jeffrey D. (ed.), 1994. "The Transition in Eastern Europe, Volume 1," National Bureau of Economic Research Books, University of Chicago Press, edition 1, number 9780226056609, July.
    22. Henry S. Farber, 2011. "Job Loss in the Great Recession: Historical Perspective from the Displaced Workers Survey, 1984-2010," NBER Working Papers 17040, National Bureau of Economic Research, Inc.
    23. Gotz-Kozierkiewicz, Danuta & Kolodko, Grzegorz W, 1992. "Fiscal Adjustment and Stabilization Policies: The Polish Experience," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 8(1), pages 14-26, Spring.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. repec:zbw:bofitp:2020_017 is not listed on IDEAS
    2. William Pyle, 2021. "Russia’s “impressionable years”: life experience during the exit from communism and Putin-era beliefs," Post-Soviet Affairs, Taylor & Francis Journals, vol. 37(1), pages 1-25, January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. repec:lic:licosd:22108 is not listed on IDEAS
    2. Sweder J. G. van Wijnbergen & Tim Willems, 2016. "Learning Dynamics and Support for Economic Reforms: Why Good News Can Be Bad," The World Bank Economic Review, World Bank, vol. 30(1), pages 1-23.
    3. Bohacek, Radim & Myck, Michal, 2017. "Economic Consequences of Political Persecution," IZA Discussion Papers 11136, Institute of Labor Economics (IZA).
    4. repec:lic:licosd:15304 is not listed on IDEAS
    5. Ruiz-Valenzuela, Jenifer, 2015. "Job loss at home: children’s school performanceduring the Great Recession in Spain," LSE Research Online Documents on Economics 63804, London School of Economics and Political Science, LSE Library.
    6. Kennedy, Robert E., 1997. "A tale of two economies: Economic restructuring in post-socialist Poland," World Development, Elsevier, vol. 25(6), pages 841-865, June.
    7. Justin Yifu Lin, 2005. "Viability, Economic Transition and Reflection on Neoclassical Economics," Kyklos, Wiley Blackwell, vol. 58(2), pages 239-264, May.
    8. Andreas Gulyas & Krzysztof Pytka, 2019. "Understanding the Sources of Earnings Losses After Job Displacement: A Machine-Learning Approach," CRC TR 224 Discussion Paper Series crctr224_2019_131, University of Bonn and University of Mannheim, Germany.
    9. repec:bla:etrans:v:11:y:2003-03:i:1:p:3-23 is not listed on IDEAS
    10. Laurila, Juhani & Singh, Rupinder, 2000. "Sequential reform strategy : The case of Azerbaijan," BOFIT Discussion Papers 8/2000, Bank of Finland, Institute for Economies in Transition.
    11. Fujita, Shigeru, 2018. "Declining labor turnover and turbulence," Journal of Monetary Economics, Elsevier, vol. 99(C), pages 1-19.
    12. Oana-Ramona SOCOLIUC (GURIȚĂ) & Andreea-Oana IACOBUȚĂ-MIHĂIȚĂ & Elena CIORTESCU, 2021. "Private property - the inclusive institution which shaped dissimilar economic dynamics. Evidence from the Czech Republic and Romania," Eastern Journal of European Studies, Centre for European Studies, Alexandru Ioan Cuza University, vol. 12, pages 213-243, December.
    13. George F. DeMartino, 2015. "Harming Irreparably: On Neoliberalism, Kaldor-Hicks, and the Paretian Guarantee," Review of Social Economy, Taylor & Francis Journals, vol. 73(4), pages 315-340, December.
    14. Jenifer Ruiz-Valenzuela, 2015. "Job Loss at Home: Children's School Performance During the Great Recession in Spain," CEP Discussion Papers dp1364, Centre for Economic Performance, LSE.
    15. Jenifer Ruiz-Valenzuela, 2020. "Job loss at home: children’s school performance during the Great Recession," SERIEs: Journal of the Spanish Economic Association, Springer;Spanish Economic Association, vol. 11(3), pages 243-286, September.
    16. Christian Sellar & Rudolf Pástor, 2015. "Mutating Neoliberalism: The Promotion of Italian Investors in Slovakia before and after the Global Financial Crisis," International Journal of Urban and Regional Research, Wiley Blackwell, vol. 39(2), pages 342-360, March.
    17. Webber, Douglas A., 2018. "Employment Adjustment over the Business Cycle: The Impact of Competition in the Labor Market," IZA Discussion Papers 11887, Institute of Labor Economics (IZA).
    18. Dickens William T. & Triest Robert K., 2012. "Potential Effects of the Great Recession on the U.S. Labor Market," The B.E. Journal of Macroeconomics, De Gruyter, vol. 12(3), pages 1-41, October.
    19. Guo, Angela & Krolikowski, Pawel & Yang, Meifeng, 2023. "Displaced workers and the pandemic recession," Economics Letters, Elsevier, vol. 226(C).
    20. Raviv, Alon & Sisli-Ciamarra, Elif, 2013. "Executive compensation, risk taking and the state of the economy," Journal of Financial Stability, Elsevier, vol. 9(1), pages 55-68.
    21. repec:zbw:bofitp:2000_008 is not listed on IDEAS
    22. Jan Marcus, 2014. "Does Job Loss Make You Smoke and Gain Weight?," Economica, London School of Economics and Political Science, vol. 81(324), pages 626-648, October.
    23. Ulla Grapard, 1997. "Theoretical Issues of Gender in the Transition from Socialist Regimes," Journal of Economic Issues, Taylor & Francis Journals, vol. 31(3), pages 665-686, September.
    24. Song, Younghwan, 2017. "The Effect of Job Displacement on Subjective Well-being," IZA Discussion Papers 10962, Institute of Labor Economics (IZA).

    More about this item

    Keywords

    economic transition; unemployment; life histories; long-term effects;
    All these keywords.

    JEL classification:

    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
    • P30 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - General

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:iza:izadps:dp11342. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Holger Hinte (email available below). General contact details of provider: https://edirc.repec.org/data/izaaade.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.