In Russia Began Social Inequality Growth
OREANDA-NEWS In 2017 in Russia recorded the lowest inflation in the entire post-Soviet history-it was 2.5%. Inflation was also low for the poor, which contributes to the growth of consumption of low-income groups and, as a consequence, to the reduction of social inequality, wrote Svetlana Misikhina, Deputy Director of the HSE development Centre, in her review Comments on the state and business.
In 2017, Russia reached the minimum level of social inequality since 2006, according to preliminary data from Rosstat. The Gini coefficient (the most common indicator of property stratification in society) was 0.410 at the end of last year — below this level, the indicator fell only in 2005 (0.409). The Gini coefficient takes values from zero in the case of absolute equality to one in the case of absolute inequality.
The prices that are used to calculate inflation and the subsistence minimum are estimated by Rosstat. The Federal service of state statistics bases its estimates on prices in cities, which can lead to insufficient accounting of prices of goods in non-chain stores and payment for services in rural areas, Misikhina noted. It is also important which goods and services are taken into account for the calculation of the consumer price index, with what weights and what period of consumption is used.
However, in 2018, the indicator of inequality has already begun to grow, and in 2019, due to the acceleration of inflation and the slowdown in the growth of public sector wages, this gap will increase, Misikhina suggested.
The increase in inequality is due to the fact that the incomes of 20% of the wealthiest population grew faster than the incomes of 40% of the wealthiest population (by 4.84% against 3.08%, respectively). This led to a decrease in the share of income of 40% of the poorest population and an increase in the share of income of the wealthiest group in the total cash income of the population.
The acceleration of consumer inflation and the slowdown in wage growth will provoke an increase in inequality, said Misikhina. At the same time, the government's promised accelerated increase in pensions for non-working pensioners may slow down the process, she said.