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Poverty in the Transition: Social Expenditures and the Working-Age Poor

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  • Klugman, Jeni
  • Micklewright, John
  • Redmond, Gerry

Abstract

A combination of economic growth and committed revenue-raising should give most governments in Central and Eastern Europe and the former Soviet Union considerable scope to devote increased resources to tackling poverty. We review the extent and nature of poverty across the transition countries, emphasising the phenomenon of the working-age poor. We consider governments’ fiscal positions and revenue raising tools, including the issue of whether some countries now have levels of external debt servicing that are so high as to hamper social sector expenditures. We analyse whether the introduction of credible unemployment benefit schemes in the CIS would aid labour market reform and hence help solve the problem there of in-work poverty (we first review experience in Central and Eastern Europe). We focus on the case of Russia, and simulate a simple scheme with 2000 household survey data. The Paper concludes by considering the role of improved wages for public service workers and the targeting of categorical benefits.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 3389.

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Date of creation: May 2002
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Handle: RePEc:cpr:ceprdp:3389

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Keywords: social expenditures; poverty; transition;

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References

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  1. Maria Ponomareva & Ekaterina Zhuravskaya, 2004. "Federal Tax Arrears in Russia: Liquidity Problems, Federal Redistribution, or Regional Resistance?," Working Papers w0003, Center for Economic and Financial Research (CEFIR).
  2. George C. Tsibouris & Vito Tanzi, 2000. "Fiscal Reform Over Ten Years of Transition," IMF Working Papers 00/113, International Monetary Fund.
  3. Ham, John C & Svejnar, Jan & Terrell, Katherine, 1998. "Unemployment and the Social Safety Net during Transitions to a Market Economy: Evidence from the Czech and Slovak Republics," American Economic Review, American Economic Association, vol. 88(5), pages 1117-42, December.
  4. FAREED M. A. HASSAN & ŽELJKO BOGETIC, 1996. "Effects Of Personal Income Tax On Income Distribution: Example From Bulgaria," Contemporary Economic Policy, Western Economic Association International, vol. 14(4), pages 17-28, October.
  5. Grogan, Louise & van den Berg, Gerard J, 1999. "The Duration of Unemployment in Russia," CEPR Discussion Papers, C.E.P.R. Discussion Papers 2268, C.E.P.R. Discussion Papers.
  6. Elena Bardasi & Ana Lasaosa & John Micklewright & Gyula Nagy, 1999. "Measuring the Generosity of Unemployment Benefit Systems: Evidence from Hungary and elsewhere in Central Europe," Budapest Working Papers on the Labour Market, Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences 9908, Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences.
  7. Guido Friebel, 2000. "Why Russian Workers do not Move: Attachment of Workers through In-Kind Payments," Econometric Society World Congress 2000 Contributed Papers 1376, Econometric Society.
  8. Gimpelson, Vladimir & Treisman, Daniel & Monusova, Galina, 2000. "Public Employment and Redistributive Politics: Evidence from Russia’s Regions," IZA Discussion Papers 161, Institute for the Study of Labor (IZA).
  9. Brown, J. David & Earle, John S., 2002. "Gross Job Flows in Russian Industry Before and After Reforms: Has Destruction Become More Creative?," Journal of Comparative Economics, Elsevier, vol. 30(1), pages 96-133, March.
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  11. Brian Pinto & Vladimir Drebentsov & Alexander Morozov, 2000. "Give Macroeconomic Stability and Growth in Russia a Chance," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 8(2), pages 297-324, July.
  12. Gerry Redmond, 1998. "Incomes, Incentives and the Growth of Means Testing in Hungary," Discussion Papers 0087, University of New South Wales, Social Policy Research Centre.
  13. Liam P. Ebrill, 1999. "Tax Reform in the Baltics, Russia, and Other Countries of the Former Soviet Union," IMF Occasional Papers 182, International Monetary Fund.
  14. Annette N. Brown, 1997. "The Economic Determinants of the Internal Migration Flows in Russia During Transition," William Davidson Institute Working Papers Series 89, William Davidson Institute at the University of Michigan.
  15. UNICEF Innocenti Research Centre. MONEE project, 2001. "A Decade of Transition," Regional Monitoring Report, UNICEF Innocenti Research Centre remore01/15, UNICEF Innocenti Research Centre.
  16. Broadman, Harry G. & Recanatini, Francesca, 2001. "Is Russia restructuring ? new evidence on job creation and destruction," Policy Research Working Paper Series 2641, The World Bank.
  17. Christian Keller & Peter S. Heller, 2001. "Social Sector Reform in Transition Countries," IMF Working Papers 01/35, International Monetary Fund.
  18. Tito Boeri & Katherine Terrell, 2002. "Institutional Determinants of Labor Reallocation in Transition," Journal of Economic Perspectives, American Economic Association, vol. 16(1), pages 51-76, Winter.
  19. Micklewright, John & Nagy, Gyula, 1999. "Living standards and incentives in transition: the implications of UI exhaustion in Hungary," Journal of Public Economics, Elsevier, vol. 73(3), pages 297-319, September.
  20. Jeffrey M. Davis & A. Cheasty, 1996. "Fiscal Transition in Countries of the Former Soviet Union," IMF Working Papers 96/61, International Monetary Fund.
  21. Coudouel, Aline & Marnie, Sheila & Micklewright, John, 1999. "Targeting Social Assistance in a Transition Economy: the Mahallas in Uzbekistan," CEPR Discussion Papers, C.E.P.R. Discussion Papers 2064, C.E.P.R. Discussion Papers.
  22. Jorge Martinez-Vazquez & Robert McNab, 2000. "Tax Reform in The Tax Reform Experiment in Transitional Countries," International Center for Public Policy Working Paper Series, at AYSPS, GSU, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University paper0001, International Center for Public Policy, Andrew Young School of Policy Studies, Georgia State University.
  23. Jorge Martinez-Vasquez & Jameson Boex, 2001. "Russia's Transition to a New Federalism," World Bank Publications, The World Bank, number 15248, October.
  24. Guariglia, Alessandra & Kim, Byung-Yeon, 2001. "The Dynamics of Moonlighting: What is happening in the Russian informal economy?," BOFIT Discussion Papers 5/2001, Bank of Finland, Institute for Economies in Transition.
  25. Martina Lubyova & Jan C. van Ours, 1999. "Unemployment durations of job losers in a labour market in transition," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 7(3), pages 665-686, November.
  26. Vodopivec, Milan & Worgotter, Andreas & Raju, Dhushyanth, 2003. "Unemployment benefit systems in Central and Eastern Europe : a review of the 1990s," Social Protection Discussion Papers 26307, The World Bank.
  27. Irina Denisova & Stanislav Kolenikov & Ksenia Yudaeva, 2000. "Child Benefits and Child Poverty," Working Papers w0006, Center for Economic and Financial Research (CEFIR).
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Citations

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Cited by:
  1. Brück, Tilman & Danzer, Alexander M. & Muravyev, Alexander & Weißhaar, Natalia, 2007. "Determinants of Poverty during Transition: Household Survey Evidence from Ukraine," Proceedings of the German Development Economics Conference, Göttingen 2007 33, Verein für Socialpolitik, Research Committee Development Economics.
  2. Gustafsson, Bjorn & Nivorozhkina, Ludmila, 2005. "How and why transition made income inequality increase in urban Russia: A local study," Journal of Comparative Economics, Elsevier, vol. 33(4), pages 772-787, December.
  3. Fabian Bornhorst & Simon Commander & UNICEF - United Nations Children's Fund, 2005. "Integration and the Well-being of Children in the Transition Economies," Innocenti Working Papers inwopa05/31, UNICEF Innocenti Research Centre.
  4. Stepan Jurajda & Daniel Münich, 2002. "Understanding Czech Long-Term Unemployment," William Davidson Institute Working Papers Series 498, William Davidson Institute at the University of Michigan.
  5. Brück, Tilman & Danzer, Alexander M. & Muravyev, Alexander & Weisshaar, Natalia, 2010. "Poverty during transition: Household survey evidence from Ukraine," Munich Reprints in Economics, University of Munich, Department of Economics 19991, University of Munich, Department of Economics.
  6. Noland, Marcus & Son, Hyun H., 2012. "Editors’ introduction transitional economies: Progress and pitfalls," Journal of Asian Economics, Elsevier, vol. 23(2), pages 107-110.
  7. Radwan Shaban & Hiromi Asoaka & Bob Barnes & Vladimir Drebentsov & John Langenbrunner & Sajaia Zurab & James Stevens & David Tarr & Emil Tesliuc & Olga Shabalina & Ruslan Yemtsov, 2006. "Reducing Poverty through Growth and Social Policy Reform in Russia," World Bank Publications, The World Bank, number 6955, October.
  8. repec:wii:bpaper:bowp:086 is not listed on IDEAS
  9. Mihaly Simai, 2006. "Poverty and Inequality in Eastern Europe and the CIS Transition Economies," Working Papers, United Nations, Department of Economics and Social Affairs 17, United Nations, Department of Economics and Social Affairs.
  10. repec:wii:bpaper:bowp:090 is not listed on IDEAS
  11. Olgica Ivančev & Milena Jovičić & Tijana Milojević, 2010. "Income Inequality and Social Policy in Serbia," wiiw Balkan Observatory Working Papers 86, The Vienna Institute for International Economic Studies, wiiw.
  12. Sunnee Billingsley, 2010. "The Post-Communist Fertility Puzzle," Population Research and Policy Review, Springer, Springer, vol. 29(2), pages 193-231, April.
  13. Tiiu Paas, 2003. "Social Consequences of Transition and European Integration Processes in the Baltic States," ERSA conference papers ersa03p382, European Regional Science Association.
  14. Facchini, Giovanni & Segnana, Maria Luigia, 2003. "Growth at the EU periphery: the next enlargement," The Quarterly Review of Economics and Finance, Elsevier, Elsevier, vol. 43(5), pages 827-862.
  15. Larysa Krasnikova & Olena Osinkina & Tamara Podvysotskaya & Yuriy Podvysotskiy, 2011. "Does health Matter for Inequality in Transition Countries: The Case of Ukraine," wiiw Balkan Observatory Working Papers 90, The Vienna Institute for International Economic Studies, wiiw.

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