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Poverty in Poland, Hungary, and Yugoslavia in the years of crisis, 1978-87

  • Milanovic, Branko

The deep economic crisis that characterized Eastern Europe in the 1980's had a strong impact on average incomes of the population and on the percentage of people living below the poverty line. The situation deteriorated most sharply in Poland, where the percentage of the poor in total population increased from less than 10 percent before the crisis to more than 20 percent by the late 1980's. In Yugoslavia, increase was somewhat less (from 17 to 25 percent) while in Hungary overall poverty rate remained constant. Perhaps as important was the change in composition of poverty; before the crisis most of the poor lived in rural areas, now most of the poor live in cities. Social groups most affected by the economic decline are urban, socialized sector workers; their real wages, or real per capita income of their households, having declined by more than 30 percent in Poland and Yugoslavia. Reduction in income was accompanied by an unchanged pattern of distribution as socialized sector wages were generally cut uniformly across the board.

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Paper provided by The World Bank in its series Policy Research Working Paper Series with number 507.

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Date of creation: 30 Sep 1990
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Handle: RePEc:wbk:wbrwps:507
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  1. Hagenaars, Aldi J M & van Praag, Bernard M S, 1985. "A Synthesis of Poverty Line Definitions," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 31(2), pages 139-54, June.
  2. Morrisson, Christian, 1984. "Income distribution in East European and Western countries," Journal of Comparative Economics, Elsevier, vol. 8(2), pages 121-138, June.
  3. Okrasa, W., 1988. "Redistribution and the two dimensions of inequality : An east-west comparison," European Economic Review, Elsevier, vol. 32(2-3), pages 633-643, March.
  4. Gomulka, Stanislaw & Rostowski, Jacek, 1988. "An international comparison of material intensity," Journal of Comparative Economics, Elsevier, vol. 12(4), pages 475-501, December.
  5. Smith, James P & Welch, Finis R, 1989. "Black Economic Progress after Myrdal," Journal of Economic Literature, American Economic Association, vol. 27(2), pages 519-64, June.
  6. Brada, Josef C, 1989. "Technological Progress and Factor Utilization in Eastern European Economic Growth," Economica, London School of Economics and Political Science, vol. 56(224), pages 433-48, November.
  7. Kilpatrick, Robert W, 1973. "The Income Elasticity of the Poverty Line," The Review of Economics and Statistics, MIT Press, vol. 55(3), pages 327-32, August.
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