Regional Welfare Disparities in the Kyrgyz Republic
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World Bank, Washington, DC
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Kyrgyz Republic is an interesting case
to study welfare disparities because of pronounced and long
existed differences across various regions, rural, and urban
areas of the country in spite of economic growth and overall
poverty reduction (World Bank 2011). For instance urban
poverty stood at 31 percent versus 40 percent in rural areas
in 2011 (national statistical committee). The welfare
disparities are particularly striking between the growing
capital Bishkek and the other regions. Thus, for example,
the poverty in the Naryn region is 50 percent versus 18
percent in the capital. The main goal of this paper is to
analyze regional disparities in the Kyrgyz Republic by
quantifying and separating the gap in welfare disparities in
2011 into two parts: the first part associated with
observable characteristics of households and the second part
associated with differences in marginal returns to these
characteristics (potentially related to geographic factors).
Welfare disparities are analyzed between and within the
regions. In addition, the role of returns and
characteristics in explaining welfare disparities both at
the mean and across the distribution using oaxaca-blinder
decomposition and its extensions is quantified. The proposed
research is an important source of empirical evidence
testing the propositions from the new economic geography.
This is also the first empirical paper aimed at explaining
regional welfare disparities in a country from the Central
Asian region where the urban rural gap is an important
component of inequality. The paper is structured as follows:
it starts from the background information describing welfare
disparities, economic growth and structural differences
across different areas. The third section briefly discusses
the methodology. The results of the decomposition are
presented and discussed in the fourth section. The fifth
section concludes.
Palabras clave
ACCESS TO INFRASTRUCTURE, ACCESS TO MARKETS, AGRICULTURAL SECTOR, CONCENTRATION OF PEOPLE, CONFLICT, CONSUMPTION PER CAPITA, DECLINE IN POVERTY, DEVELOPING COUNTRIES, DEVELOPMENT ECONOMICS, DISPARITIES BETWEEN REGIONS, ECONOMIC ACTIVITY, ECONOMIC GEOGRAPHY, ECONOMIC GROWTH, ECONOMIC STRUCTURE, EMPLOYMENT STATUS, ENDOGENOUS VARIABLES, EXTERNALITIES, HEADCOUNT RATIO, HOUSEHOLD BUDGET, HOUSEHOLD CHARACTERISTICS, HOUSEHOLD COMPOSITION, HOUSEHOLD MEMBERS, HOUSEHOLD SIZE, HOUSEHOLD SURVEY, HUMAN CAPITAL, HUMAN CAPITAL ENDOWMENTS, INCOME, LAGGING REGIONS, LIVING STANDARDS, PER CAPITA CONSUMPTION, POLICY IMPLICATIONS, POLITICAL ECONOMY, POOR, POOR PEOPLE, POVERTY ANALYSIS, POVERTY LINE, POVERTY RATES, POVERTY REDUCTION, PRODUCTIVITY, PROSPEROUS REGIONS, PUBLIC GOODS, REGIONAL DEVELOPMENT, REGIONAL DIFFERENCES, REGIONAL DISPARITIES, REGIONAL DUMMIES, REGIONAL INEQUALITY, REGIONAL WELFARE, RURAL, RURAL AREAS, RURAL GAP, RURAL INEQUALITY, RURAL RESIDENTS, RURAL WORKERS, SELF-EMPLOYMENT, STANDARD ERRORS, URBAN AREAS, WAGES, WELFARE DISTRIBUTION, WELFARE INDICATOR