Open unemployment in Russia has been growing very slowly - by only about 1 percentage point a year. This is mainly because of a degree of wage flexibility unknown in the West. Comparing industries over a two year period we find that, if relative employment fell by 10%, relative wages fell by...

In Eastern Europe (as in Western) wages will be mainly set by collective bargaining. The bargains are likely to be at a level of the firm. Cross-country evidence suggests that where there is a high coverage of collective bargaining and bargaining is at a firm level, quite high unemployment is...

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