December 2008

IZA DP No. 3886: So Many Rocket Scientists, So Few Marketing Clerks: Estimating the Effects of Economic Reform on Occupational Mobility in Estonia

Nauro F Campos, Aurelijus Dabušinskas

published in: European Journal of Political Economy, 2009, 25 (2), 261-275

Why do workers change occupations? This paper investigates occupational mobility and its determinants following a large unexpected shock (communism's collapse in 1989.) Our calculations show that from 1989 to 1995 between 35 and 50 percent of Estonian workers changed occupations (classified at one- and four-digits, respectively). Among the main determinants of occupational mobility we find firm tenure, labour market experience and returns to alternative occupations. We investigate the role of gender and ethnicity and find strong results for the former, with mobility mainly driven by push factors for males (returns to current occupations) and by pull factors for females (returns to alternative occupations).