HOUSING AND INCOME DISTRIBUTION IN RUSSIA: ZHIVAGO'S LEGACY

Abstract

The inadequacy of housing and its effect on the quality of life go a long way toward explaining many aspects of Russian life, but little data has been available to determine how housing affected the relative well-being of the citizenry. This paper presents comprehensive data examining for the first time the effect that seventy years of a socialist housing allocation scheme had on the distribution of income. It seems clear that housing provided by the government or by employers has a value that can be measured to yield useful inferences about the distribution of income and wealth. This article shows that housing allocation had a progressive effect on the distribution of income in Russia. In addition, when the imputed value of housing is added to household income, the increase in income inequality that occurred in recent years is significantly reduced. The analysis concludes with a discussion of how housing policy could be used to address poverty concerns, an important aspect of the transition process.