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Factors of market income inequality in Central and Eastern European countries

Author

Listed:
  • Daniil Storchevoi

    (Lomonosov Moscow State University)

Abstract

Objective:The factors of market income inequality in eleven Central and Eastern European countries (Bulgaria, Croatia, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland,Romania, Slovakia, Slovenia) are analyzed in the present article. The main thesis is that changes in employment structures and, more specifically, decreasing shares of employment in the industrial sector are the key drivers of income inequality in the majority of these countries. Method: The central idea of the paper is confirmed by the results of the panel data regression analysis. Results: The changes in employment structures are the main determinant of income inequality in most of the CEE countries. A decrease in the level of employment in the industrial sector (the effect is intensified by a decrease in the level of agriculture employment, in several countries) results in growing market income inequality. Nonetheless, the effect of such changes in the employment structures can be partly compensated by a growing share of the population with tertiary education or the specifics of a particular economy.Originality: The study demonstrates the overall impact of the transformations in the employment structures on market income inequality in the CEE countries and defines the factors which can deter the rising levels of income inequality.

Suggested Citation

  • Daniil Storchevoi, 2026. "Factors of market income inequality in Central and Eastern European countries," Romanian Journal of Economics, Institute of National Economy, vol. 62(1(71)), pages 70-98, June.
    • Handle: RePEc:ine:journl:v:62:y:2026:i:71:p:70-98
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    References listed on IDEAS

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    1. Svilena MIHAYLOVA & Silviya BRATOEVA-MANOLEVA, 2018. "Structural changes and wage inequality in the Bulgarian economy," Eastern Journal of European Studies, Centre for European Studies, Alexandru Ioan Cuza University, vol. 9, pages 205-227, December.
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    6. Brzezinski, Michal, 2018. "Income inequality and the Great Recession in Central and Eastern Europe," Economic Systems, Elsevier, vol. 42(2), pages 219-247.
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    8. Daniil STORCHEVOI, 2024. "The impact of employment in industry on income inequality in Great Britain," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania / Editura Economica, vol. 0(3(640), A), pages 137-148, Autumn.
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    JEL classification:

    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure

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