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Earnings inequality and informal Employment in Russia

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  • Anna Lukiyanova

    () (Centre for Labor Market Studies, Higher School of Economics, Moscow.)

Abstract

In this paper I investigate the impact of informality on earnings inequality in Russia using RLMS-HSE data for 2000-2010. I find that during the whole period earnings inequality was substantially higher in the informal sector. Informality increases earnings polarization, thereby widening both tails of the distribution. Changes in the earning distribution of the formal sector were mainly generated by changes in the distribution of hourly earnings. In the informal sector, reduction of inequality occurred via two channels: Differences in hourly rates and working hours both declined. Changes in the structure of informality and conditional wage differentials did not have a significant impact on the overall earnings inequality, with the exception of decline in irregular employment

Suggested Citation

  • Anna Lukiyanova, 2013. "Earnings inequality and informal Employment in Russia," HSE Working papers WP BRP 37/EC/2013, National Research University Higher School of Economics.
  • Handle: RePEc:hig:wpaper:37/ec/2013
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    References listed on IDEAS

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    More about this item

    Keywords

    earnings inequality; informal economy; decomposition; recentered influence functions;

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J42 - Labor and Demographic Economics - - Particular Labor Markets - - - Monopsony; Segmented Labor Markets

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