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Inequality Reduction in Mongolia: A Dynamic Income Source Analysis

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  • Zagdbazar, Manlaibaatar

Abstract

Mongolia's Gini coefficient decreased by 26% over the past 15 years (2007-2022). This period, marked by a mining boom and bust cycle and great economic transformation. This study finds that the reduction in inequality is attributed to shifts in household income composition, including rising shares of wage income and government transfers, and declining shares of self-employment and own-consumption income. The expansion of the formal labor market, particularly in mining, trade, and finance, alongside social welfare programs like child benefits and pensions, has been pivotal. Interestingly, income from own consumption of housing, which has not been extensively considered in the literature, contributed most to the decrease in inequality due to its substantial reduction in both share and concentration. However, herder households remain vulnerable to shocks, and gender/regional disparities persist. This study, analyzing monetary and non-monetary well-being, offers insights into mining-dependent and transition economies seeking inclusive growth.

Suggested Citation

  • Zagdbazar, Manlaibaatar, 2025. "Inequality Reduction in Mongolia: A Dynamic Income Source Analysis," MPRA Paper 125662, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:125662
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    References listed on IDEAS

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    Keywords

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    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D33 - Microeconomics - - Distribution - - - Factor Income Distribution
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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