Abstract
Analyses of household budget surveys, national accounts data on functional income distribution, and data on the dispersion of wages, indicate that income inequality in Poland, after falling over the 1993–96 period, rose significantly from 1997 onwards. Farmers and the unemployed were the main losers. The overall position of wage‐earners improved, although wage inequality increased sharply in the second half of the 1990s. Employers and the self‐employed fared quite well. This coincided with fiscal policy changes which substantially slowed down progression in income taxes. Over the 1993–96 period growth was high and balanced. Subsequently, growth slowed down, giving rise to serious fiscal and external deficits.
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