Work detail

Wage and Employment Adjustments in Czech Local Labor Markets

Author: Bc. Nikola Stavarová
Year: 2021 - summer
Leaders: Mgr. Barbara Pertold-Gebicka M.A., Ph.D.
Consultants:
Work type: Bachelors
Language: Czech
Pages: 52
Awards and prizes:
Link:
Abstract: This work aims to test the hypothesis of whether interregional migration is motivated by
the level of wages. More specifically, whether people are moving to regions with higher
average wages. In the analysis, we used data from 14 regions of the Czech Republic for
the period from 2009 to 2018. We created a model where the dependent variable was
net migration and the main independent was a wage. We've added more variables for
more accurate estimates. We also created a combined variable of wages and living
costs, the so-called part of the wage for costs. Costs were represented by either the price
of housing or the price of food. In some models, we used these variables as the main
ones examined instead of wages. We estimated all models by using fixed and random
effects and then compared them by the Hausmann test. Due to the character of Prague as
a deviation, we divided the models according to whether they are estimated for all
regions or with the omission of the capital. The results showed a significant positive
wage coefficient in the case of models without Prague. Also part of the wage for
housing was significant and positive in the models estimated by random effects and part
of the wage for food was estimated significant and positive with the omission of Prague.
So the hypothesis was confirmed in models without Prague and the positive effect of
wages was not completely dampened even by the cost of living.

Partners

Deloitte

Sponsors

CRIF
McKinsey
Patria Finance