Income Differentiation of Residents of Ukraine Under Conditions of Shadow Economy

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Income Differentiation of Residents of Ukraine Under Conditions of Shadow Economy

Journal Title: Демографія та соціальна економіка - Year 2016, Vol 3, Issue

Abstract

The objective of the article is to study income differentiation of the population of Ukraine with consideration of its shadow components. Official data-based analysis of income differentiation indicates a moderate rate of inequality in income distribution in Ukraine, as compared with the EU. At the same time, a share of the shadow economy exceeds the safe level by most estimates. As there is no reliable data for assessments of distribution of the shadow incomes, such a study is very relevant. The article discusses some possible criteria to characterize the distribution of the shadow incomes by decile population groups based on the author’s approach, suggesting consideration of the structure of household’s expenditures and self-assessment of the quality of life. The presented findings indicate significant variation in the population differentiation by total incomes and adjusted total incomes. Considering the shadow income component proves that real inequality in income distribution in Ukraine is significantly higher in comparison to official data. Ignoring relevant problems only creates the social and political instability in society. Thus, the question of legalization of the national economy, distribution, and redistribution of income is based on transparency and social justice that is a priority of the government.

Authors and Affiliations

G. M. Urchik, N. M. Samoliuk

Keywords

EP ID EP176854
DOI 10.15407/dse2016.03.133
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