Academic Scientific JournalsHow big are labour productivity disparities in Poland
Keywords:
taxes, productivity, institutional sectors, shadow economyAbstract
The ongoing discussion on inequalities in Poland focuses on household income. It ignores the scale of differences in labour productivity. In order to fill this gap, having combined national accounts and employment data we show that a narrow group of 7.2 million people working in non-financial and financial enterprises account for almost 60% of Polish GDP and 75% of income tax revenues and social security contributions from the private sector. This structure of the economy represents both an opportunity and a threat to growth prospects. Flows of new employees to the enterprise sector from micro-businesses of low productivity or agriculture can considerably increase their productivity. At the same time, however, large differences in productivity, leading to income disparities, create the temptation to tax productive entities more heavily in order to finance transfers to less productive ones, which in turn perpetuates the current structure of the economy.
Downloads
References
Baumann J., Kritikos A.S.: The link between R&D, innovation and productivity: Are micro firms different?, Research Policy no. 45, 2016.
Bernal, A.: Podatek od wartości dodanej – studium przerzucalności podatku na konsumentów, pracowników i dawców kapitału [The value added tax incidence – tax shifting on consumers, employees and capital owners], Poznań: Wydawnictwo Uniwersytetu Ekonomicznego w Poznaniu, 2019.
Bogumil P.: Securing Poland’s economic success II: labour market and product specialization – is there a link?, Ecfin Country Focus no. 4, 2015. Available at: doi:10.2765/157668, accessed: 01st June 2020.
Brzezinski M.: Is high inequality an issue in Poland?, IBS Policy Papers no. 1 (2017), available at: https://ideas.repec.org/p/ibt/ppaper/pp012017.html, accessed: 05th May 2020.
Brzeziński M., et al: Reevaluating Distributional Consequences of the Transition to Market Economy in Poland: New Results from Combined Household Survey and Tax Return Data, IZA Discussion Papers no. 12734, Institute of Labor Economics (IZA), 2019.
Di Cintio M., et al: Firm growth, R&D expenditures and exports: An empirical analysis of Italian SMEs, Research Policy vol. 46 (4), 2017.
Dougherty S. M.: Legal reform, contract enforcement and firm size in Mexico, Review of International Economics, vol. 22 (4), 2014.
Estrin S., et al: Which institutions encourage entrepreneurial growth aspirations?, Journal of Business Venturing, Elsevier, vol. 28(4), 2013.
Fabbri D.: Law enforcement and firm financing: Theory and evidence, Journal of the European Economic Association, vol. 8(4), 2010.
Friesenbichler K., et al: The efficiency of EU public administration in helping firms grow, Brussels: European Commission, DG Enterprise and Industry, 2014.
GAO, Value added taxes. Potential Lessons for the United States from Other Countries’ Experiences, United States Government Accountability Office Report, GAO-11–867T, 2011.
García-Posada M., Mora-Sanguinetti J. S.: Entrepreneurship and Enforcement Institutions: Disaggregated Evidence for Spain, European Journal of Law and Economics no. 40, 2015.
Garicano L., et al: Firm size distortions and the productivity distribution: Evidence from France, American Economic Review, vol. 106 (11), 2016.
Giacomelli S., Menon C.: Firm Size and Judicial Efficiency: Evidence from the Neighbour’s Court, Bank of Italy Working Paper no. 898, 2013.
Guner N., et al: Macroeconomic implications of size-dependent policies, Review of Economic Dynamics, vol. 11 (4), 2008.
Laeven, L. i Woodruff, C.: The Quality of the Legal System, Firm Ownership, and Firm Size, Review of Economics and Statistics vol. 89 (4), 2007.
Łaszek A., Trzeciakowski R.: Tylko 5,6 mln osób wytwarza połowę polskiego PKB [Only 5.6 million people produces half of Polish GDP], Analiza FOR (FOR Analysis) no. 8, 2018. Available at: https://for.org.pl/pl/a/6105,analiza-8/2018-tylko-5-6-mln-osob-wytwarza-polowe-polskiego-pkb, accessed: 10th April 2020.
Melitz M. J., Ottaviano G. I. P:, Market size, trade, and productivity, Review of Economic Studies, vol. 75(1), 2008.
Pagano P., Schivardi F.: Firm size distribution and growth, Scandinavian Journal of Economics, vol. 105 (2), 2003.
Pellegrino B., Zingales L.: Diagnosing the Italian disease, Working Paper no. 23964, Cambridge: National Bureau Of Economic Research, 2017. Available at: https://www.nber.org/papers/w23964, accessed: 29th October 2020.
Poschke M.: The firm size distribution across countries and skill-biased change in entrepreneurial technology, American Economic Journal: Macroeconomics vo. 10 (3), 2018.
Rajan R. G., et al: What Determines Firm Size? CRSP Working Paper no. 496; and USC Finance & Business Econ. Working Paper no. 01-1. Available at: http://dx.doi.org/10.2139/ssrn.170349, accessed: 31st May 2020.
Schivardi F., Schmitz T.: The IT Revolution and Italy's Two Lost Decades, Journal of the European Economic Association, vol. 18 (5), 2020.
Shefer D., Frenkel A.: R&D, firm size and innovation: an empirical analysis, Technovation vol. 25(1), 2005.
Trzeciakowski, R., Potrzebujemy imigrantów. Jak zatrzymać ukraińskich pracowników w Polsce? [We need immigrants. How to keep Ukrainian workers in Poland?), Analiza FOR (FOR Analysis] no. 7, 2018. Available at: https://for.org.pl/pl/a/6100,analiza-7/2018-potrzebujmy-imigrantow-jak-zatrzymac-ukrainskich-pracownikow-w-polsce, accessed: 31st May 2020.
Van Biesebroeck J.: Firm Size Matters: Growth and Productivity Growth in African Manufacturing, Economic Development and Cultural Change no. 53(3), 2005.
Žukauskas V. (ed.): Shadow Economy: Understanding Drivers, Reducing Incentives, LFMI, 2018. Available at: https://en.llri.lt/news/economic-policy/shadow-economy-understanding-drivers-reducing-incentives/lrinka, accessed: 1st June 2020.
Other official documents:
European Commision, Country Report Poland 2019, available at: https://ec.europa.eu/info/sites/info/files/file_import/2019-european-semester-country-report-poland_en.pdf, accessed: 01st June 2020.
GUS, Activity of non-financial enterprises in 2017, Statistics Poland, 2018.
GUS, National accounts by institutional sectors and sub-sectors 2014–2017, Statistics Poland, 2019.
Downloads
Published
How to Cite
Issue
Section
License
Financial Law Review is an open access journal which means that all the articles published are freely available without charge to the reader or his/her institution.
The articles published in Financial Law Review are available under a licence Attribution-NonCommercial-NoDerivs 3.0 Unported (CC BY-NC-ND 3.0)
The Author furnishes a non-exclusive and free-of-charge license to use the his Work without territorial limitations and for an unlimited period.
Archiving policy
All texts from the journal Financial Law Review are published in electronic version. We strive to archive texts in various databases. Archival issues are also available on the platform of the Academic Scientific Journals: https://czasopisma.bg.ug.edu.pl/index.php/flr/index
Moreover articles published in the journal are archived at the Repository of the University of Gdansk.
