Contribution of various income sources to interregional inequality of the per capita income in the Russian Federation

Authors

  • Marina Malkina Lobachevsky State University of Nizhni Novgorod

DOI:

https://doi.org/10.24136/eq.v12i3.21

Keywords:

personal income, sources, interregional inequality, decomposition

Abstract

Research background: The reduction lately observed in interregional differences in the per capita income in Russia requires some clarification of the reasons. One possible way to do this could be decomposition of interregional inequality in personal incomes by income sources, i.e.: wages and salaries, property incomes, social transfers, entrepreneurship incomes and revenues from informal activities.

Purpose of the article: The objective of this research is identification of the character, direction and degree of influence of various income sources on interregional inequality and convergence of Russian regions by their per capita income in 2001?2014. 

Methods: We brought personal incomes in the regions to a comparable level using the relative cost of fixed consumer basket. Then we applied the population-weighted Gini coefficient, coefficient of variation, and the Theil index to measure the interregional inequality in personal incomes in dynamics. Further usage of various techniques of inequality decomposition allowed us to evaluate contribution of different types of income to the Russian regions? convergence across time.

Findings & value added: Various types of income demonstrated different paths of interregional inequality, changes in interaction and in the shares of total income, which altogether influenced spatial inequality. Wages and salaries showed the largest and growing impact on inequality. The contribution of informal incomes to the overall inequality was the second largest, but diminishing and negatively interacting with other unevenly distributed types of income; thereby they provided more than half of the total interregional convergence. Entrepreneurship incomes revealed slightly decreasing influence on inequality, which was mainly neutralized by their reduction in the share of total income. Social transfers demonstrated the largest smoothing effect, however, their contribution to convergence was exhausted. Property incomes evidenced the greatest enhancing impact on inequality especially in the period of recovery. Additionally, informal incomes played the role of substitutes for formal incomes providing self-replicating mechanisms for reducing inequality in Russia.

Downloads

Download data is not yet available.

References

Abdullah, A. J., Doucouliagos, H., & Manning, E. (2015). Are regional incomes in Malaysia converging? Papers in Regional Science, 94(S1). doi: 10.1111/pirs. 12105.
Amarante, V. (2016). Income inequality in Latin America: a factor component analysis. Review of Income and Wealth, 62. doi: 10.1111/roiw.12236.
Chongvilaivan, A. & Kim, J. (2016). Individual income inequality and its drivers in Indonesia: a Theil decomposition reassessment. Social Indicators Research, 126. doi: 10.1007/s11205-015-0890-0.
Garcia-Pe?alosa, C., & Orgiazzi, E. (2013). Factor components of inequality: a cross-country study. Review of Income and Wealth, 59(4). doi: 10.1111/roiw.12054.
Guriev, S., & Vakulenko, E. (2012). Convergence between Russian regions. CEFIR / NES Working Paper series, 180 (October).
Guriev S., & Vakulenko E. (2015). Breaking out of poverty traps: internal migra-tion and interregional convergence in Russia. Journal of Comparative Econom-ics, 43. doi: 10.1016/j.jce.2015.02.002.
Ivanova, V. (2014). Regional convergence of income: spatial analysis. Spatial Economics, 4. doi: 10.14530/se.2014.4.100-119.
Jedrzejczak, A. (2010). Decomposition analysis of income inequality in Poland by subpopulations and factor components. Argumenta Oeconomica, 24(1).
Kholodilin K., Siliverstovs B., & Oshchepkov A. (2012). The Russian regional convergence process: where does it go? Eastern European Economics, 50(3). doi: 10.2753/EEE0012-8775500301.
Lehmann H., & Silvagni M. G. (2013). Is there convergence of Russia's regions? Exploring the empirical evidence: 1995?2010. OECD Economics Department Working Papers, 1083.
Lerman, R. I., & Yitzhaki, S. (1989). Improving the accuracy of estimates of Gini coefficients. Journal of Econometrics, 42. doi: 10.1016/0304-4076(89)90074-2.
Malkina, M. Yu. (2015). Evaluation of the factors of intra-regional income differ-entiation of the Russian population. Spatial Economics, 3. doi: 10.14530/se.2015.3.097-119.
Malkina, M. Yu. (2016a). Institutional framework of income inequality in modern economy. Journal of Institutional Studies, 8(1). doi: 10.17835/2076-6297.2016.8.1.100-120.
Malkina, M. Yu. (2016b). On the issue of weighting in interregional studies (in response of K.P. Gluschenko). Spatial Economics, 1. doi: 10.14530/se.2016.1.163-184.
Ovcharova, L. N., Popova, D. O., & Rudberg, A. M. (2016). Decomposition of income inequality in contemporary Russia. Journal of the New Economic Association, 3.
Russian Federation Federal State Statistics Service (2016). Retrieved from http://www.gks.ru/wps/wcm/connect/rosstat_main/rosstat/en/main/.
Shorrocks, A. F. (1982). Inequality decomposition by factor components. Econo-metrica, 50(1). doi: 10.2307/1912537.
Yemtsov, R. (2005). Quo vadis? Inequality and poverty dynamics across Russian regions. In Ravi Kanbur & Anthony J. Venables (Eds.). Spatial inequality and development. Oxford: Oxford University Press.
Zubarevich, N. V. (2013). Inequality in population incomes: a projection in space. Pro et Contra, 6.

Downloads

Published

2017-09-30

How to Cite

Malkina, M. (2017). Contribution of various income sources to interregional inequality of the per capita income in the Russian Federation. Equilibrium. Quarterly Journal of Economics and Economic Policy, 12(3), 399?416. https://doi.org/10.24136/eq.v12i3.21

Issue

Section

Socio-economic consequences of (in)equality

Similar Articles

<< < 5 6 7 8 9 10 

You may also start an advanced similarity search for this article.