Expenditures on the salaries of public sector employees constitute a very important component of public expenditures, currently around CZK 200 billion annually in the Czech Republic. Adjusting the remuneration of employees in public administration (sector) is therefore an important option for increasing the efficiency of use of public funds. The assessment of the current system of public sector employee remuneration and a proposal for some specific changes to be made to it is the focus of this dissertation. The primary aim of my dissertation is to analyze the system of remuneration of employees of public and private sectors, both qualitatively and quantitatively. Within the primary target there is also a decomposition analysis, which indicates whether the employees are discriminated against in any of the sectors. The secondary objective is to make recommendations for the system of remunerating public sector employees of the in order to increase its efficiency in terms of public spending while maintaining its incentive function. The work is divided into five chapters. The first chapter, entitled "Theoretical Foundations," provides an overview of the relevant literature, the fundamental basis in economic theory, and issues of the Mincer wage equation, which is then later used as the basis for regression and decomposition analyses, and mainly describes in detail the decomposition method that is used to explain the difference in the salary level in the private and the public sector. These decomposition methods represent, together with quantile regression, the main tool used to meet the objectives of this work. The second chapter, entitled "The Remuneration of Public Sector Employees," describes the structure of the remuneration of employees of the public sector. The data shows that the current system produces results in the form of salaries that do not correspond to the market. The third chapter, called "Regression Model," builds on the analysis performed on data from QSAE, which was discussed in the second part of the previous chapter, and its purpose is to prepare the documents for verification and deepen their conclusions. The fourth chapter, called "Regression and Decomposition Analysis," is based on the regression model assembled in the previous chapter, and describes the results of the regression decomposition analysis performed on the described sample data. This chapter verifies the hypotheses set out in the introduction and answers research questions. The fifth and final chapter, entitled "Interpretation of the Results and Recommendations," focuses on the interpretation of the results, the proposed regulation of remuneration, and recommendations for further research. The main finding of this work is that the system of remuneration of public sector workers is set so that, while the overall average brings quite comparable results in terms of the salary as the entire labor market, it is not throughout the distribution. The performed regression analysis showed that both the public and private sectors evaluate the same things differently (different values of the regression coefficients of variables), and both at the average and along the entire distribution. We can say that the mechanism of the remuneration of employees of the public sector is different from that of the market. This fact is confirmed by the significantly higher coefficient of determination of the regression model of the public sector. Regarding possible discrimination in wages, the analysis showed that employees in the public sector may in contrary to the preposition of positive discrimination be positively discriminated against only up to approximately fifteenth percentile. From fifteenth percentile they are discriminated against negatively. This was confirmed by the decomposition analysis performed on the average salaries, which indicates that public sector employees are, at this level, negatively discriminated against (if the public sector employees have the same regression coefficients as private sector employees, their earnings increase). Finally, this conclusion is confirmed by the dummy variable, which represents belonging to the private sector when the value of its corresponding regression coefficients, in quantile regression analysis along the distribution, evolves from negative to positive and is significantly increasing. The thesis also shows how the system of remunerating public sector employees can be adjusted to reward employees in a way that is comparable with the market.
| Identifer | oai:union.ndltd.org:nusl.cz/oai:invenio.nusl.cz:196937 |
| Date | January 2008 |
| Creators | Picka, Jakub |
| Contributors | Kubátová, Květa, Izák, Vratislav, Malý, Ivan |
| Publisher | Vysoká škola ekonomická v Praze |
| Source Sets | Czech ETDs |
| Language | Czech |
| Detected Language | English |
| Type | info:eu-repo/semantics/doctoralThesis |
| Rights | info:eu-repo/semantics/restrictedAccess |
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