Date and Location

March 6, 2020
12:00 PM - 1:00 PM
B-500 Bell Hall


You get what you pay for: Sources and consequences of the public sector premium in Albania and Sri Lanka Photo


We study the factors behind the public sector premium in Albania and Sri Lanka, the group heterogeneity in the premium, the sources of public sector wage compression, and the impact of this compression on the way individuals self-select between the public and the private sector. Similar to other countries, the public sectors in Albania and Sri Lanka pay higher wages than the private sector, for all but the most valued employees. While half of the premium of Sri Lanka and two-thirds of it in Albania are explained by differences in the occupation-education-experience mix between the sectors, and the level of private sector informality, the unexplained part of the premium is significant enough to affect the preferences of working in the public sector for different groups. We show that the compressed distributions of public sector wages and benefits create incentives for positive sorting into the public sector among most employees, and negative sorting among the most productive ones. Work co-authored with Ricardo Hausmann and Sehar Noor.


Ljubica Nedelkoska joined the Center for International Development's Growth Lab as a Visiting Scholar in 2012 and as a Research Fellow in 2013.

Before joining the CID, she worked as a post-doctoral researcher and a coordinator of the Economics of Innovation Research Group in Jena, and as a research fellow at the Zeppelin University, both in Germany.

Her research area is empirical labor economics, with focus on human capital, human mobility, migration and diasporas, and skill-technology relations. By studying these topics, she aims to understand how economies change their skill portfolios through the processes of on-the-job learning, interacting with technologies, and formal education and training; and how these changes transform the countries’ levels of productivity and development. She is also interested in economic policy and has participated in several economic policy projects in Albania, Sri Lanka, Germany, the Netherlands and Sweden.

She holds a PhD in Economics of Innovation from the Friedrich-Schiller-University in Jena, Germany and a Master's Degree in Public Administration from the Appalachian State University, North Carolina.

Lunch will be served!