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dc.contributor.authorYemtsov, Ruslanen_US
dc.description.abstractIn the period of macroeconomic crisis in Georgia between 1991 and1994 the combination ofhyperinflation, catastrophic output drop and weak governance, have led to a sharp rise ininequality among households. Sharp inequities have arisen not only between households, butalso between regions. This paper gives a picture of the main channels of redistribution and ofthe main driving forces of income inequality in Georgia, as it emerges from the analysis of thefirst representative survey of incomes and expenditures of Georgian households in 1996-1997.The paper finds that the level of inequality for money income in Georgia is comparable to highestinequality countries of Latin America (Gini equals 0.6). However, given the degree ofinformalization and demonetization of the economy, measuring only reported monetary incomesgives a somewhat misleading picture of the living standards. The paper argues that consumptionis a much better indicator of welfare, especially in the Georgian context and explores therelationship between income and consumption in the Georgian context. Using consumption, weget the picture that is marked by very clear, though, not as striking inequalities (Gini coefficient of0.36). Growth has not yet had a strong impact on consumption inequality per se, but we findevidence that during 1996-97 consumption increased at almost all levels of the distribution.During the same period, there was significant income mobility, except for those at the verybottom or the very top of the income distribution. For the latter, economic success appears to beclosely associated with labor market status, ownership of productive assets and resultingearnings opportunities. Georgian economy is generating a system of much inequality. The keyshare of inequality can be attributed to informal incomes (using the decomposition analysis asproposed by Shorrocks). State transfers being reduced to minimum levels do exercise only aslight positive impact on the overall inequality outcomes.en_US
dc.publisher|aInstitute for the Study of Labor (IZA) |cBonnen_US
dc.relation.ispartofseries|aIZA Discussion paper series |x252en_US
dc.subject.keywordReturns to educationen_US
dc.subject.keywordin-kind incomeen_US
dc.subject.keywordincome mobilityen_US
dc.subject.keywordunreported incomesen_US
dc.subject.keywordTheil entropy indexen_US
dc.subject.keywordmean log deviation indexen_US
dc.titleInequality and Income Distribution in Georgiaen_US
dc.typeWorking Paperen_US

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