Job reallocation and productivity growth in the Ukrainian transition

We analyse the pace and patterns of job reallocation in Ukraine using 1992-2000 panel data on nearly the universe of continuing manufacturing firms inherited from the Soviet Union. Employment growth displays a substantial increase in heterogeneity during this transition period, with a corresponding rise in excess job reallocation. Unlike data for Soviet Russia in the 1980s, Ukrainian job reallocation in the 1990s was clearly productivity enhancing, both within and across industries. The speed of the increase in reallocation and its effect on aggregate productivity was somewhat slower than in Russia, however, perhaps reflecting the more 'gradualist' reform strategy in Ukraine.