Inequality, Transfers and Growth : New Evidence From the Economic Transition in Poland /

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 mark...

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Bibliographic Details
Main Author: Prasad, Eswar
Other Authors: Keane, Michael
Format: Journal
Language:English
Published: Washington, D.C. : International Monetary Fund, 2000.
Series:IMF Working Papers; Working Paper ; No. 2000/117
Online Access:Full text available on IMF
Description
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.
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Physical Description:1 online resource (52 pages)
Format:Mode of access: Internet
ISSN:1018-5941
Access:Electronic access restricted to authorized BRAC University faculty, staff and students