This paper surveys the literature on public-private sector wage differentials for Russian labor market. We give an overview of the main results and problems of the existing research. The authors unanimously confirm that in Russia private sector workers receive higher wages relative to their public sector counterparts. According to different estimates the "premium" varies between 7 and 40%. A correct evaluation of this "premium" is subject to debate and is a particular case of a more general econometric problem of wage differentials estimation. The main difficulties are related to data limitations, self-selection and omitted variables. Reasons for the existence of a stable private sector "premium" in Russia are not fully investigated.
Wage dispersion, returns to skill, and black-white wage differentials
