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Income and consumption inequality in Poland, 1998–2008

Author

Listed:
  • Michał Brzeziński

    (University of Warsaw, Faculty of Economic Sciences)

  • Krzysztof Kostro

    (University of Warsaw, Faculty of Economic Sciences
    Polish Academy of Sciences, Institute of Economics)

Abstract

This paper estimates a variety of inequality indices to study the evolution of income and consumption inequality in Poland between 1998 and 2008. We use robust methods to adjust for the impact of extremely large observations. We also conduct statistical tests on inequality changes using methods, which account for the complexity of the household sample design. All analyses are performed for the entire population, for rural and urban subpopulations, and for the three largest cities. The main result is that during 1998–2008 there was a statistically significant rise in economic inequalities in Poland, which depending on the inequality index, ranged from 8.7% to 19.6% in case of income distribution and from 6.5% to 12.3% in case of consumption distribution. Among the studied subpopulations, economic inequalities are both the highest and the fastest-growing in Warsaw, where consumption inequality as measured by the Gini index increased during the studied period by as much as almost 23%.

Suggested Citation

  • Michał Brzeziński & Krzysztof Kostro, 2010. "Income and consumption inequality in Poland, 1998–2008," Bank i Kredyt, Narodowy Bank Polski, vol. 41(4), pages 45-72.
    • Handle: RePEc:nbp:nbpbik:v:41:y:2010:i:4:p:45-72
    Note: Most of the work for this paper was completed shortly before the untimely passing of my dear friend Krzysztof Kostro in August 2009. We would like to thank two anonymous referees for very detailed comments and constructive suggestions that helped greatly to improve this paper. We also thank Bronislaw Lednicki (Central Statistical Office) for providing data on sample design for Household Budget Survey study. Any remaining errors are our own responsibility.
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    References listed on IDEAS

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    1. VAN KERM Philippe, 2007. "Extreme incomes and the estimation of poverty and inequality indicators from EU-SILC," IRISS Working Paper Series 2007-01, IRISS at CEPS/INSTEAD.
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    Cited by:

    1. Michał Brzeziński & Michał Myck & Mateusz Najsztub, 2019. "Reevaluating distributional consequences of the transition to market economy in Poland: new results from combined household survey and tax return data," Working Papers 2019-18, Faculty of Economic Sciences, University of Warsaw.
    2. Zdeňka Malá & Gabriela Červená, 2012. "Relation And Development Of Expenditure Inequality And Income Inequality Of Czech Households," Economic Annals, Faculty of Economics and Business, University of Belgrade, vol. 57(192), pages 55-78, January –.
    3. Litwiński Michł, 2019. "The Influence of Income Inequalities on Socio-Economic Development in the European Union," Econometrics. Advances in Applied Data Analysis, Sciendo, vol. 23(1), pages 45-60, March.
    4. Oyvat, Cem, 2016. "Agrarian Structures, Urbanization, and Inequality," World Development, Elsevier, vol. 83(C), pages 207-230.
    5. Kacper Grejcz & Zbigniew Żółkiewski, 2017. "Household wealth in Poland: the results of a new survey of household finance," Bank i Kredyt, Narodowy Bank Polski, vol. 48(3), pages 295-326.
    6. Brzezinski, Michal & Myck, Michał & Najsztub, Mateusz, 2022. "Sharing the gains of transition: Evaluating changes in income inequality and redistribution in Poland using combined survey and tax return data," European Journal of Political Economy, Elsevier, vol. 73(C).

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    More about this item

    Keywords

    income inequality; consumption inequality; Pareto model; robust estimation; statistical inference; Poland;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • P36 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - Consumer Economics; Health; Education and Training; Welfare, Income, Wealth, and Poverty

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