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Why are wages still lower in eastern and central Europe?

This new working paper explores why there is a persistent wage gap between western Europe and the new EU Member States of eastern and central Europe. Why is it still the case that after 27 years of transition from state socialism and 14 years of EU membership the closing of the gap in living standards between western Europe and eastern and central... Find out more

Petr Pavlínek, Ricardo Aláez-Aller, Carlos Gil-Canaleta, ...

Foreign Direct Investment and the development of the automotive industry in Eastern and Southern Europe

This working paper provides an overview of foreign direct investment (FDI) in the automotive industry in Eastern Europe and Spain since the 1990s.The authors examine the main trends and patterns of FDI in Czechia, Poland, Hungary, Slovakia, Slovenia, Romania, Hungary, Serbia and Spain as well as the impact of the 2008 economic crisis on further... Find out more

Unit labour costs: no argument for low wages in eastern and central Europe

This working paper discusses the use of unit labour costs (ULC) by the European Commission as a measure of competitiveness of exports, especially in central and Eastern Europe (CEE). It shows the flawed nature of the European Commission’s argument that increasing wages ahead of measured productivity would necessarily represent a threat to export... Find out more

What role can minimum wages play in overcoming the low-wage model in central and eastern Europe?

This working paper gives an overview of minimum wage policies in Central and Eastern Europe. It shows that minimum wages are an effective tool for reducing inequality by raising the lowest incomes. Minimum wages can have some, albeit limited, role in increasing aggregate productivity and promoting economic upgrading. However, to be truly effective... Find out more