Inequality, Transfers and Growth: New Evidence From the Economic Transition in Poland
Electronic Access:
Free Download. Use the free Adobe Acrobat Reader to view this PDF file
Summary:
This paper challenges the conventional wisdom that inequality in Poland increased markedly during the economic transition. Income and consumption inequality actually declined in 1990-92 and rose only moderately above pre-transition levels by 1997. However, inequality in labor earnings increased markedly and consistently during 1990-97. Social transfer mechanisms, including pensions, helped mitigate increases in overall inequality and poverty. More importantly, these transfer mechanisms were well-designed to reduce political resistance to market-oriented reforms in the early years of transition, paving the way for rapid growth. Cross-country evidence from transition economies is consistent with this interpretation and with recent literature suggesting that inequality-reducing redistribution can enhance growth.
Series:
Working Paper No. 2000/117
Subject:
Consumption Income Income distribution Income inequality Labor National accounts Wages
English
Publication Date:
June 1, 2000
ISBN/ISSN:
9781451854008/1018-5941
Stock No:
WPIEA1172000
Pages:
52
Please address any questions about this title to publications@imf.org