A Study of the Relationship between Wage Dynamics in the Public and Private Sectors of the Economy

This article presents the results of an empirical study examining the relationship between wage dynamics in the public (social services, science) and private sectors at the regional level from 2013 to 2024. Using data from Rosstat and a Vector Error Correction Model (VECM), cointegration of the time series was confirmed. The findings indicate a significant relationship between wage movements in these two sectors. In the long run, wage dynamics are primarily driven by the private sector, while the public sector adjusts to these changes. In the short term, a statistically significant effect of public sector wage growth on the private sector was observed (p = 0.06, Wald test), particularly in regions with low income levels and a high share of workers affected by the 2012 "May Decrees" of the President of the Russian Federation. The analysis revealed a trend toward a reduction in the intersectoral wage gap until 2021, followed by a sharp increase by 2024, which is attributed to institutional differences in the flexibility of personnel decision-making.

intersectoral wage gap, regional disparities, public sector