Occupational Prestige and Labor Market Institutions

In this paper, we ask a question whether regulation of professions is related to occupational prestige by employees. We investigate, whether legal control of an access to selected professions is related with these professions’ prestige and in which circumstances. The question seems to be significant from the perspective of peoples’ decisions about desired career paths. Occupational prestige may by itself affect utility of workers. Analysis of the determinants of occupational prestige still constitutes an underexploited niche. In this paper we aim to respond to this lacuna and provide a systematic analysis of the problem from institutional perspective. We draw on literature in new institutional economics, law and economics, labor economics, and related fieldsto conceptualize the possible channels and directions of institutions’ impact on occupational prestige. We also conduct the empirical research, basing on the data since 1992 till 2010 for Polish labor market and verify whether conclusions from the literature, are valid in this case. It turned out that factors significant for employee’s subjective prestige perception are restrictions concerning an access to a profession, income, age, education, marital status and parents’ professional prestige. The obtained results contribute to a better understanding of the nature of labor market institutions and their impact on people’s decisions regarding career, and provide theoretical underpinnings for empirical studies. The outcome of the econometric research on the occupational prestige in relation top articular Polish institutional settings serve as a base for polemics with theoretical issues and may be valuable for labor market policy design