Ruslan Yemtsov

Channels of redistribution: Inequality and poverty in the Russian transition

Contrary to popular perception, Russia entered the transition with significant inequality. Using the large Russian Longitudinal Monitoring Survey dataset, we demonstrate that inequality has subsequently risen yet further and by end-1996 was roughly comparable to inequality in Mexico, Colombia or Malaysia. Driving this increase has been not only wealth transfers through privatization but also changes in government expenditure and a sharp growth in earnings dispersion. There has been a large, associated shift in the structure of income. The paper also looks at the incidence and depth of poverty over the period 1992-96. At the start of transition, roughly half the population of households fell below the poverty line. While this has subsequently declined, at end-1996 nearly 40 percent of households were below the poverty line and a substantial stratum of households were locked in chronic poverty.

Household Strategies for Coping with Poverty and Social Exclusion in Post-Crisis Russia

What strategies have Russian households used, to cope with economic hardship in the wake of recent financial crisis? Which coping strategies have been most effective in reducing poverty for different groups of households? And how have people been able to adapt to the dramatic drop in formal cash incomes? The authors look at these questions using subjective evaluations of coping strategies used by household survey respondents to mitigate the effects of the Russian financial crisis on their welfare. The data come from two rounds (1996 and 1998) of the Russian Longitudinal Monitoring Survey. The results of their analysis show that a households choice of survival strategy, strongly depends on its human capital: the higher its level of human capital, the more likely it is to choose an active strategy (such as finding a supplementary job, or increasing home production). Households with low levels of human capital, those headed by pensioners, and those whose members have low levels of education, are more likely to suffer social exclusion. To prevent poverty from becoming entrenched, the trend toward marginalization, and impoverishment of these groups of households, needs to be monitored, and targeted policy interventions need to be undertaken to reverse the trend.

Combining Longitudinal Household and Community Surveys for Evaluation of Social Transfers: infrastructure rehabilitation projects in rural Georgia

This paper combines longitudinal household and community level survey data to evaluate the effect of infrastructure rehabilitation projects on household well-being in rural Georgia. The panel structure of the data is utilized in an empirical approach to control for time-invariant unobservable factors at the community level by applying propensity score-matched double difference comparison. The results indicate that improvements in school and road infrastructure produce non-trivial gains on village and country levels. School rehabilitation projects produce the largest gains for the poor, while the road projects benefit the poor and non-poor in different aspects of well- being. From a methodological point of departure it is concluded that ad hoc community surveys matched with ongoing nationally representative longitudinal household surveys can provide a feasible and low-cost tool for evaluation of the effectiveness of social transfers.

Russian Unemployment: Its Magnitude, Characteristics, and Regional Dimensions

Registered unemployment in Russia is now 2 percent; surveys indicate a true rate of between 5 and 6 percent. Until now, flow in and out of unemployment have been quite large, with duration low. This may be changing as the ease with which workers are matched to jobs declines -- in part because of financing constraints on firms. Already there is great regional variation in unemployment -- which, as this model indicates, is likely to persist because of the mismatch in distribtution of jobs and the unemployed.

Social Protection, Poverty, and the Post-2015 Agenda

Social protection is absent from the Millennium Development Goals (MDGs), and only recently has gained some prominence in the post-2015 discourse. In the past quarter century, however, rising inequality has often accompanied economic growth. At the same time, the growing importance of risk and vulnerability on the wellbeing of the poor has been recognized. Further, there is now a consensus on adopting more ambitious goals on poverty reduction. Defining social protection as a collection of programs that address risk, vulnerability, inequality and poverty through a system of transfers in cash or in kind, this paper argues that social protection needs to be on the post-2015 agenda as a key element of the discourse. It provides an empirical overview of social protection around the world based on the World Banks Atlas of Social Protection: Indicators of Resilience and Equity (ASPIRE) data set. Focusing on the goal of ending poverty, the paper estimates that social protection programs are currently preventing 150 million people from falling into poverty. Based on the data set, the paper develops, tentatively and for discussion, a set of candidate goals, indicators and targets for the acceleration of poverty reduction through social protection. The authors ask what it would take for social protection programs to contribute to halving the poverty gap in a country. They show that if all countries could achieve the actual poverty reduction efficiency already observed in the top quartile of countries, then 70 percent of the countries in the sample could achieve this goal. However, for 30 percent of the countries, even reaching the top quartile on efficiency will not be enough -- for these countries, the issue is one of budgetary adequacy.

Bosnia and Herzegovina 2001-2004: Enterprise Restructuring, Labor Market Transitions and Poverty

This paper takes stock of labor market developments in Bosnia and Herzegovina over the period 2001-2004, using the panel Living Standards Measurement Study/Living in Bosnia and Herzegovina survey. The analysis estimates a multinomial logit model of labor market transitions by state of origin (employment, unemployment, and inactivity) following the specification of widely used models of transition probabilities, and analyzes the impact of standard covariates. The results provide strong evidence that there are indeed significant differences in labor market transitions by gender, age, education, and geographic location. Using the panel structure of the multi-topic survey data, the authors find that these transitions are related to welfare dynamics, with welfare levels evolving differently for various groups depending on their labor market trajectories. The findings show that current labor market trends reflecting womens movement out of labor markets and laid-off male workers accepting informal sector jobs characterized by low productivity will lead to adverse social outcomes. These outcomes could be averted if the planned enterprise reform program creates a more favorable business environment and leads to faster restructuring and growth of firms.

Who Bears the Cost of Russia's Military Draft?

The authors use data from a large nationally representative survey in Russia to analyze the distributional and welfare implications of draft avoidance as a common response to Russias highly unpopular conscription system. They develop a simple theoretical model that describes household compliance decisions with respect to enlistment. The authors use several econometric techniques to estimate the effect of various household characteristics on the probability of serving in the army and the implications for household income. Their results indicate that the burden of conscription falls disproportionately on the poor. Poor, rural households, with a low level of education, are more likely to have sons who are enlisted than urban, wealthy, and better-educated families. The losses incurred by the poor are disproportionately large and exceed the statutory rates of personal income taxes.