The Effect of Privatization Method on Inequality in Eastern European Transition Economies

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Abstract/Contents

Abstract: Transition economies in Eastern European experienced a drastic change in both income and consumption inequality following privatization of the public sector using voucher, sale, and management-employee buyout methods of privatization. This paper draws on the insights of Bennett, Estrin, and Urga’s (2007) study regarding the effect of privatization method on the growth rate of transition economies, and instead analyzes the effect of privatization method on income and consumption inequality. To do this, factors that contribute to the phenomenon of inequality are studied. The three privatization methods are demonstrated to have insignificant effects on changes in income inequality, but significant effects on changes in consumption inequality. The sale and management-employee buyout methods are shown to be associated with an increase in consumption inequality, while the voucher method is shown to be associated with a decrease in consumption inequality, for the decade following privatization.

Type of resource	text
Date created	May 2011

Author	Bonneau, Alissa Anne
Primary advisor	Shoven, John B.
Degree granting institution	Stanford University, Department of Economics

Subject	Stanford Department of Economics
Subject	privatization
Subject	transition economies
Subject	income inequality
Subject	consumption inequality
Subject	Gini coefficient
Genre	Thesis

Related item	Title 2011 John G. Sobieski Award for Creative Thinking
Location	https://purl.stanford.edu/xk481sg6302

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Preferred Citation: Bonneau, Alissa Anne. (2011). The Effect of Privatization Method on Inequality in Eastern European Transition Economies. Stanford Digital Repository. Available at: https://purl.stanford.edu/xk481sg6302

Stanford University, Department of Economics, Honors Theses

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