Session

Management, Business and Economics

Description

Low economic growth and job creation remain among the most serious problems in the R. Macedonia. Past Governments have failed to resolve these issues despite several interventions. Consequently, the country is still challenged by alarmingly high poverty and inequality in the distribution of income. The aim of this study is therefore to examine trends in poverty and income inequality in the R. Macedonia for the period 2010-2015 using official data from the State Statistical Office based on the Survey on Income and Living Conditions.

Findings show that the at-risk-of-poverty rate in the R. Macedonia has decreased 5.8 p.p. in the study period reaching 21.5% in 2015. The study furthermore shows that the most vulnerable groups in this context are multi-member households and the unemployed when observing poverty by economic activity. Observing inequality in the income distribution in R. Macedonia, the study shows a positive trend, but still at an alarmingly high level. The Gini coefficient has decreased by 7.1 p.p. in the study period; registering a coefficient of 33.7% in 2015. Furthermore, according to findings, the top 1% share of income in the country hold 14% of the total income while one percent have a monthly income of over 1.523 euros, while 50% are below 212 euros per month.

Reducing the poverty in the country and the income inequality calls for a serious commitment including increased efforts to attract more foreign investments, increase of the minimum wage and reforms in tax policy, which should be oriented towards direct taxes rather than indirect taxes, and the introduction of a progressive tax system.

Keywords:

poverty, income inequality, Gini coefficient

Session Chair

Edmond Hajrizi

Session Co-Chair

Armend Muja

Proceedings Editor

Edmond Hajrizi

ISBN

978-9951-437-59-2

First Page

66

Last Page

70

Location

Durres, Albania

Start Date

28-10-2017 9:00 AM

End Date

28-10-2017 10:30 AM

DOI

10.33107/ubt-ic.2017.243

Included in

Business Commons

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Oct 28th, 9:00 AM Oct 28th, 10:30 AM

Poverty and income inequality in the Republic of Macedonia

Durres, Albania

Low economic growth and job creation remain among the most serious problems in the R. Macedonia. Past Governments have failed to resolve these issues despite several interventions. Consequently, the country is still challenged by alarmingly high poverty and inequality in the distribution of income. The aim of this study is therefore to examine trends in poverty and income inequality in the R. Macedonia for the period 2010-2015 using official data from the State Statistical Office based on the Survey on Income and Living Conditions.

Findings show that the at-risk-of-poverty rate in the R. Macedonia has decreased 5.8 p.p. in the study period reaching 21.5% in 2015. The study furthermore shows that the most vulnerable groups in this context are multi-member households and the unemployed when observing poverty by economic activity. Observing inequality in the income distribution in R. Macedonia, the study shows a positive trend, but still at an alarmingly high level. The Gini coefficient has decreased by 7.1 p.p. in the study period; registering a coefficient of 33.7% in 2015. Furthermore, according to findings, the top 1% share of income in the country hold 14% of the total income while one percent have a monthly income of over 1.523 euros, while 50% are below 212 euros per month.

Reducing the poverty in the country and the income inequality calls for a serious commitment including increased efforts to attract more foreign investments, increase of the minimum wage and reforms in tax policy, which should be oriented towards direct taxes rather than indirect taxes, and the introduction of a progressive tax system.