Economic Annals 2012 Volume 57, Issue 192, Pages: 55-78
https://doi.org/10.2298/EKA1292055M
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The relation and development of expenditure inequality and income inequality of Czech households
Malá Zdeňka (Czech University of Life Sciences in Prague, Faculty of Economics and Management, Department of Economics, Prague, Czech Republic)
Červená Gabriela (Czech University of Life Sciences in Prague, Faculty of Economics and Management, Department of Economics, Prague, Czech Republic)
The paper focuses on an analysis of income inequality and expenditure
inequality of households in the Czech Republic for the period 2001 - 2009,
based on data from the Statistics of Family Accounts. The basic
methodological tool is the Gini coefficient and its decomposition according
to individual categories of consumer expenditure. The conducted research
reaches the conclusion that income inequality is higher than inequality in
consumer expenditure, and income inequality for the analyzed period is
growing at a higher rate than expenditure inequality. Tax-transfer tools
effectively eliminate income inequality, but nevertheless inequality of
disposable income exceeds the inequality of net monetary expenditure. As
regards the mutual relationship of income inequality and expenditure
inequality, expenditure inequality within a period of economic growth and
boom copied the course of income inequality, while within a period of
economic decline and recession both inequalities showed a completely
different development. The main determinant affecting income inequality may
be considered to be non-consumer expenditure, particularly expenditure for
the acquisition of real estate.
Keywords: Gini coefficient, primary income, disposable income, consumer expenditure, Czech Republic