Attaching Workers through In-KindPayments : Theory and Evidence from Russia

Friebel, Guido ; Guriev, Sergei

Published by Oxford University Press on behalf of the World Bank

关键词: labor markets;    migration;    in-kind payments;   

DOI  :  10.1093/wber/lhi012
RP-ID  :  77487

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

External shocks may cause a decline inthe productivity of fixed capital in certain regions of aneconomy. Exogenous obstacles to migration make it hard forworkers in those regions to reallocate to more prosperousregions. In addition, firms may devise'attachment' strategies to keep workers frommoving out of a local labor market. When workers arecompensated in kind, they find it difficult to raise thecash needed for migration. This endogenous obstacle tomigration has not yet been considered in the literature. Thearticle shows that the feasibility of attachment depends onthe inherited structure of local labor markets: attachmentcan exist in equilibrium only if the labor market issufficiently concentrated. Attachment is beneficial for bothemployers and employees but hurts the unemployed and theself-employed. An analysis of matched household-firm datafrom the Russian Federation corroborates the theory.