Inequality and Volatility Moderation in Russia: Evidence from Micro-Level Panel Data on Consumption and Income

Yuriy Gorodnichenko, Klara Sabirianova Peter () and Dmitriy Stolyarov

No 4233, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: We construct key household and individual economic variables using a panel micro data set from the Russia Longitudinal Monitoring Survey (RLMS) for 1994-2005. We analyze cross-sectional income and consumption inequality and find that inequality decreased during the 2000-2005 economic recovery. The decrease appears to be driven by falling volatility of transitory income shocks. The response of consumption to permanent and transitory income shocks becomes weaker later in the sample, consistent with greater self-insurance against permanent shocks and greater smoothing of transitory shocks. Comparisons of RLMS data with official macroeconomic statistics reveal that national accounts may underestimate the extent of unofficial economic activity, and that the official consumer price index may overstate inflation and be prone to quality bias.

Keywords: income; inequality; transition; consumption; Russia (search for similar items in EconPapers)
JEL-codes: E20 I30 J30 O15 P20 (search for similar items in EconPapers)
Pages: 72 pages
Date: 2009-06
New Economics Papers: this item is included in nep-mac and nep-tra
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Citations: View citations in EconPapers (21)

Published - revised version published in: Review of Economic Dynamics, 2010, 13 (1), 209 - 237

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Related works:
Journal Article: Inequality and Volatility Moderation in Russia: Evidence from Micro-Level Panel Data on Consumption and Income (2010)
Working Paper: Inequality and Volatility Moderation in Russia: Evidence from Micro-Level Panel Data on Consumption and Income (2009)
Working Paper: Inequality and Volatility Moderation in Russia: Evidence from Micro-Level Panel Data on Consumption and Income (2009)
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