Permalink : http://hdl.handle.net/2115/39053

This paper analyzes poverty dynamics in Russia during the 1990s in order to identify the differences among the poor. Here, poverty dynamics mean the transition into and out of poverty. The analysis uses the aggregated data of household surveys by Goskomstat and the panel data set of RLMS (the Russia Longitudinal Monitoring Survey). Considering the turmoil and economic instability as well as the extent of poverty ratios after the collapse of the USSR, it might be quite natural to pay attention to poverty dynamics. However, poverty dynamics in Russia have not been thoroughly studied before. This paper represents the first attempt to deal with this issue directly. The main subjects of the study are as follows: 1) to analyze relations between the poverty dynamics and the labour market, such as labour force status (i.e. employment, unemployment and inactivity) and occupations. Although poverty has multidimensional aspects, it is worthwhile to focus on its relations with the labour market, because the working poor dominate the poor in Russia; 2) to identify the characteristics of and differences between urban and rural poverty dynamics. The results from these subjects will also be helpful in discussing the targeted social help for the poor in Russia. Section 1 is devoted to a brief survey of the studies on poverty in Russia. In addition, the characteristics of Russian poverty are pointed out: first, the drastic increase of poverty ratios after the collapse of the USSR; second, the fluctuations of poverty ratios; finally, the high risk of falling into poverty among not only the unemployed, but also the employed. Section 2 discusses the measurement of poverty in the Russian context. Neither the poverty gap ratio (PG) nor the squared poverty gap ratio (SPG) but the headcount ratio (HI) is taken as a poverty index, because we intend to capture the move into and out of poverty. When we measure poverty, the following should be noted. Firstly, the HI should be measured on the base of expenditures. Secondly, food production on a plot intended for household consumption should be included in the structure of household expenditure. Thirdly, it would be better to use the equivalence scales in the Russian context. Finally, regional poverty lines should be employed. This paper takes this methodology in measuring HIs in Russia. Section 3 shows the trends of HIs and the poverty profile in Russia. HIs in the 1990s are fluctuating but continuously high in both urban and rural areas. Although the risk of falling into poverty in rural areas is recently getting a little higher than in urban areas, the number of the poor in urban areas is much larger than in rural areas. Besides, it is noted that the representative social groups among the poor in Russia are as follows: working people, those who are temporarily not working and the unemployed. Section 4 examines poverty dynamics, particularly its relationship with the Russian labour market, and identifies who are the transient and the chronic poor. In the whole country, the scale of the transient poor is much larger than that of the chronic poor. However, considering the difference between urban and rural poverty, rural poverty is more inclined to chronic poverty than transient poverty. Moreover, analyzing upward and downward moves of economic status, economic development is essential for the alleviation of poverty, but does not necessarily lead to the automatic reduction of poverty. It is also indicated that, in spite of the low wage level, employment plays an important role in alleviating poverty in urban areas, while inactivity, such as production of foods on a plot for household consumption is helpful to the rural residents in getting out of poverty and staying at the non-poor status. Finally, it is pointed out that almost all occupations have relations with transient poverty, and that the polarization of poverty dynamics is associated with the stratification of occupations. It could follow that, although there would be a probability that even managers, professionals, or technicians could fall into poverty, education could be a buffer against poverty. In conclusion, the paper briefly reviews the results of the analyses. Here, more attention is paid particularly to the high mobility into and out of poverty in Russia and the difference of types of poverty dynamics. With this in mind, a strategy for poverty alleviation is also mentioned.