Tuesday, October 23 2018 18:31

ArmInfo. The Gini ratio, a statistical indicator of the degree of social stratification based on consumption, puts Armenia at a moderate level of inequality, the WB  report "Unequal opportunities in the South Caucasus" says.

According to the report, while the countries of Eastern Europe and  Central Asia show some degree of heterogeneity in terms of  inequality, with Gini ratio  in the range from 0.25 to 0.45, for 15  years Georgia did not find any noticeable signs of deterioration. and  in Armenia, the Gini coefficient based on consumption ranges from  0.30 to 0.35.

It is noted that, as of November 2017, income inequality in Armenia  and Georgia is significantly lower, on average, among 30 low- and  middle-income countries. For example, Gini coefficients calculated  for final income and considering pension payments as deferred income  in Armenia and Georgia are 0.36 and 0.38, respectively, which is  significantly lower than the 0.41 coefficient for an average of 30  countries.

Moreover, as noted in the report, citizens' perception of property  inequality is often more important than the actual state of affairs,  since perception is more closely linked to effective political  actions, such as voting, behavior, or government policy. As a result,  despite rather unremarkable tendencies, the understanding that  inequality is widening is rather widespread among the residents of  Armenia and Georgia. Over 75% of respondents in Armenia and 60% in  Georgia believe that inequality is widening. Armenia is distinguished  by the fact that the proportion of the population that believes that  the gap between the rich and the poor should be reduced exceeded 80%  of the respondents and is one of the highest in the region, while  Georgia is among the countries of the region with a relatively  smaller share of the population adhering to this opinion.

According to experts, such an approach of the population is  associated with certain difficulties associated with inequality of  opportunities for people and a less transparent procedure for the  allocation of resources, which increases the degree of discontent  among people. In Armenia, this issue is most acute not so much due to  the gap between the poor and the rich, as a large gap between the  poor and middle classes and a huge gap between the poor and  oligarchs, which since the early 1990s due to uncontrolled  privatization and other illegal ways have accumulated incredibly huge  wealth. Thus, according to experts, <collapsed social contract>, and  the majority of the population realized that they face difficulties  related to unequal access to markets in the absence of competition  and inadequate regulation. This is a process in which even a good  education and significant efforts do not contribute to the growth of  well-being.

Such feelings of inequality are likely to be relevant in Azerbaijan  and Georgia, since these countries share similar institutional  problems in Armenia caused by the imperfection of the transition  period, experts at the World Bank emphasize.