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« Income distribution in a market economy»

Introduction

income inequality market economy

Relevance of this topic determined by the need for a theoretical study of the problem of state regulation of incomes of the population and identifying ways to improve income policy in conditions of market relations

The goal of any economic transformation should be focused on improving the material well-being of citizens.

The distribution of national income is a central issue in shaping the social policy model of any country. This is due to the fact that distribution mechanisms determine the level and quality of life of the population and fill social relationships in society with real content.

The state is called upon to play the main role in the distribution of income in society.

This topic is currently important for our country, because... The large, formational changes taking place in Russia necessitate transformation of the income distribution model and require solutions to complex problems.

Distribution relations are of great importance for the development of the social economy, primarily because people entering the production process, investing their labor or capital in it, hope to receive certain income. Therefore, distribution relations underlie the creation of a system of incentives for participation in the production process, and the level of its development largely depends on them. In addition, distribution, by generating income, determines the possibility of achieving socio-economic goals for the development of society, allows us to influence the level of satisfaction of needs and, consequently, the standard of living of the population in the country. In this regard, the problems of distribution and generation of income have always been the focus of attention of both economic science and governments.

The subject of the study is the state regulation of distribution relations regarding the income of various segments of the population.

The total income of the population, its level, structure, methods of receipt and differentiation are indicators of the economic and social well-being of society. Their distribution has a pronounced socio-political overtones, predetermining property and social differentiation. The distribution of income is closely related to the distribution of resources. Through income differentiation in social life, those relationships that are hidden behind the distribution of resources are revealed.

Tasks to be considered in this work:

theoretical aspects of income generation and their regulation;

explore the main directions of state income policy;

uneven distribution of income;

income distribution in Russia and features of uneven distribution in the Russian Federation.

The theoretical and methodological basis of the work was made up of published scientific works of domestic and foreign economists on the formation and distribution of citizens' incomes, as well as the main methods of their state regulation. This topic is most interestingly reflected in such sources as “Economics” by A.S. Bulatova, “Course of Economic Theory” M.N. Chepurin, as well as in periodicals (“Economist”, “Russian Economic Journal”).

For a more in-depth study, the work uses graphs, tables, diagrams, as well as cartographic material.

Income of subjects in a market economy: essence, sources, structure

The interpretation of the very concept of “income” by some modern economists is carried out in a more detailed form, while others take into account only some aspects. I.P. Nikolaeva points out that income- this is “a part of the produced product received by a participant in production depending on his participation in it.” According to A.S. Bulatov, income- “the amount of money and material goods received or produced by households over a certain period of time.”

Chepurin M.N. refers to income of the population“the share of each class, social group or individual in the product produced and assigned to them.”

Indicator of monetary income of the population - serves to measure income at the macro level and is calculated according to the Balance of Cash Income and Expenses of the Population.

In order to more fully study the incomes of citizens, some of them should be considered criteria and classifications .

Depending on the dynamics of consumer price levels, income is divided into:

nominal- this is the amount of money received in a certain period by an individual; it also characterizes the level of cash income regardless of taxation;

real- represents the quantity of goods and services that can be purchased with disposable income during a certain period;

disposable income- income that can be used for personal consumption and personal savings. Disposable income is less than nominal income by the amount of taxes and mandatory payments.

Based on the form of income units, they are distinguished:

monetary- some payments from social funds, this includes products produced on private plots and services provided by family members in the household;

natural- remuneration for labor, activities, pensions, scholarships, benefits, social benefits, income from property, as interest on deposits, securities, dividends; income from the sale of agricultural products, insurance compensation, the amount from the sale of foreign currency and many others.

Dependencies on government intervention:

primary formed under the influence of the market mechanism;

secondary, the formation of which is associated with the redistribution policy of the state.

The income of individuals is divided into:

1. Income fully included in the total annual tax:

wages and other income at the main place of work;

income from performing part-time work;

income from the acquisition of goods, works, services at prices below market prices;

material benefit from borrowed funds;

dividends and other capital income;

income in the form of exchange rate differences from foreign currency transactions;

other income that is fully included in the total annual income.

2. Income that is partially not included in the total annual income:

income from performing work under civil contracts (except for royalties);

material aid;

cost of gifts;

value of prizes;

income from the sale of apartments, residential buildings, dachas, garden houses, land plots, land shares (shares);

income from the sale of other property (except for securities);

income from the sale of securities;

income received in repayment of promissory notes;

income in kind;

income of full-time students;

income that is partially or completely not included in the total annual expense in accordance with the legislation of the constituent entities of the Russian Federation.

3. Income from business and other activities, taxation of which is carried out by tax authorities:

income from business activities;

income of private notaries;

income from rental property;

income from land rental;

other income, taxation of which is carried out by the tax inspectorate.

4. Royalties:

creation of literary works;

creation of artistic and graphic works;

creation of sculptures, objects of decorative and applied art;

creation of audiovisual works;

creation of musical and stage works;

creation of other musical works;

creation of works of science;

discoveries, inventions, industrial designs;

performance of works of literature and art;

other royalties.

5. Income taxed separately from total annual income:

· the sum of coefficients and allowances for work in the Far North;

· the amount of material benefit from deposits;

· the amount of material benefit from insurance payments.

Wages act as one of the main components of income of the population. Income from paid work constitutes remuneration for the work of employees, regulated by a contractual or contractual system of relations. Wages are also divided into nominal and real, accrued and actually paid, average and minimum.

Wage- this is the price of labor services provided by hired workers of different professions in the implementation of their business activities. Nominal wages- this is the amount of money received by an employee over a certain period of time (week, month, etc.).

Real wage- this is the nominal wage, taking into account the movement of retail prices (and tariffs). Thus, an increase in nominal wages by 15% with an increase in the level of retail prices by 10% gives an increase in real wages by 5%. Nominal wages may rise and real wages may fall if the prices of goods and services rise faster than nominal wages.

Table 1. Dynamics of real disposable cash income for 2006 - 2007

Rice. 1. Real disposable income of the population

Payments under social assistance programs from the state have a significant impact on the income received by the population. This includes pensions, payments for the maintenance of the disabled, various benefits, scholarships for students and students. Their peculiarity, unlike wages, is the nature of receipt, independent of the quantity and quality of labor.

National accounts systems also use the division of income into factorial(determined by production factors: income from labor costs, from property and capital, from self-employment using labor and capital) and non-factorial(all other types of income). These types of income are later defined as primary And current transfers.

An important source of income for the population consists of transfers or cash payments not related to payment for labor, goods and services. In other words, transfers are transactions in which goods, services or funds are provided unilaterally without receiving any equivalent in return. Social transfers in kind consist of goods and non-market services provided to specific households from federal and local budgets and public organizations free of charge.

The distribution can be distinguished functional And personal raWithdefinition.

Functional income distribution is its distribution between factors: labor, capital, natural resources and entrepreneurial ability. Functional distribution characterizes the distribution of income between factors of production, and, above all, between labor and capital.

As a result of the functional distribution of income, such primary income as wages, interest, rent and profit are formed. In the system of factors of production, the main relationship concerns capital, therefore, for simplicity, the functional distribution can be represented as the ratio between income from labor and from property.

But income, ultimately, is received not by production factors, but by specific people (or families), since they are the main suppliers of production factors - labor and capital.

For graphic image personal distribution national income is being built Lorenz curve in the following coordinate system: the x-axis reflects the share of families in the total number of families in the country, and the y-axis shows the share of national income belonging to them.

The main instrument of government redistribution is the state budget. Among the methods of income policy are: impact on wages of employees, promotion of employment, implementation of social protection of the population, tax redistribution mechanism, regulation of consumer prices for goods and services and, in general, ensuring economic stabilization.

One of the main sources of information characterizing the volume and structure of monetary income, expenses and savings of the population is balance d e Tender income and expenses of the population. To construct it, data from state statistics, financial statements of banks and extra-budgetary social funds are used. The balance reflects that part of the gross national income that comes to the population in the form of cash income. The advantages of the bottom source of information are the regularity of construction (quarterly), efficiency and focus on continuous documentary accounting of financial transactions related to the population.

The balance of cash income and expenses contains income and expenditure parts. IN income side of the balance sheet revenues from various sources are shown on the basis of statistical and financial reporting, sample household surveys. Expense part of the balance includes expenses for the purchase of goods and services by the population according to retail trade data and the increase in the population's savings in deposits and securities according to financial statements, takes into account taxes and mandatory payments paid by the population.

Revenue part The balance sheet consists of income from various sources, which can be identified using statistical and financial reporting, sample surveys and other methods.

Expenditure part The balance sheet includes transfers paid by the population, expenses for the purchase of goods and services, and the increase in household savings in deposits and securities.

Uneven distribution of income

The problem of income inequality among citizens has historically been one of the most important objects of economic theory. Many famous economists have analyzed it due to the high practical significance of this issue. And yet, the consensus was to justify the need for a policy of income redistribution, an active role in which the state was assigned.

The absolute size of the population's income and purchasing power are the main indicators of people's well-being and standard of living. The level of disposable income creates opportunities for the material and spiritual life of an individual, meeting basic needs, obtaining an education, and maintaining health. The fight against poverty and inequality in income distribution can be considered one of the priorities of the economic policy of any state.

State income policy is defined as “their redistribution through the state budget through differentiated taxation of various groups of recipients of income and social payments” 11 Economics, ed. Bulatova A.S., p.611

To assess the level and dynamics of income received, indicators of nominal, disposable and real income are used. The main type of income is nominal, it is formed mainly from labor income, capital income and transfer payments

The income received determines the level of well-being, or standard of living, of an individual. The realization of the ultimate goal of society - the creation of conditions to meet the needs of the population and improve their standard of living - depends on the amount of income received. Naturally, the distribution of income has its own characteristics at each stage of social development.

Another factor affecting income distribution is government intervention in the process of pricing consumer goods and services. Setting upper price limits or fixing them is a means of administrative regulation of the economy. It is used quite rarely, and in a market economy it is not effective enough in the long and medium term.

The most pressing task of social statistics is the study of poverty. Poverty is the “other side” of wealth. An objective fact is the differentiation of the population in income and consumption, and each has its own problems. The totality of circumstances dictates the need to solve this statistical problem. Information is required on the size of the population of the country and regions living below the poverty line, demographic composition and other characteristics of the low-income population, its average income, minimum and average amounts of food consumption, duration of stay in poverty, sources of income, employment of able-bodied household members, amounts of social assistance and etc.

This problem has two facets:

Income inequality;

Wealth inequality.

People receive income as a result of providing factors of production that they own (their labor, capital, land) for the use of firms to produce the goods people need, or they invest these resources in the creation of their own firms. This mechanism of income generation initially contains the possibility of income inequality.

The reasons for this state of affairs are:

different values ​​of factors of production owned by people (capital in the form of a computer, in principle, can bring more income than capital in the form of a shovel);

different success in using factors of production (an employee in a company producing goods in high demand may have higher earnings than his colleague of the same qualifications working in a company whose goods are sold with difficulty);

different amounts of factors of production owned by people (the owner of two oil wells receives, all other things being equal, more income than the owner of one well).

Taxation has a significant impact on the distribution of income of the population. In order to influence the generation of income, the principle of vertical and horizontal equality is established. That is, citizens must pay taxes in accordance with their ability to pay. Taxes are usually levied on personal income rather than on consumption, which does not cover savings. The redistribution of the tax burden to the rich groups of society consists of progressive income tax rates, the proportional nature of the property tax, exemption from income tax of certain minimum amounts and the establishment of tax benefits. The optimal tax structure is the one that maximizes social welfare. In it, the choice between justice and efficiency adequately reflects the attitude of society towards these goals. The main problem of tax regulation of income is a pattern: the greater income equality is expected to be achieved, the stricter the restrictions on these transformations and the greater the excess tax burden.

A high degree of progressiveness of tax rates predicts large net losses. To mitigate inequality in income distribution, tax incentives are provided.

It is rightly noted that the introduction of a flat tax rate on personal income will further reduce its revenues, and territorial budgets will lose a lot of money. “A single rate of income tax is tantamount to a complete abandonment of its distribution function, which can strengthen the already unacceptable large social differentiation of the population” 11 Ponomarenko E. On fiscal policy for 2001. (Concept analysis).//Economist. -2000. - No. 11. -p.52.

Using their income, people can spend part of it to purchase additional production factors. For example: a family can put part of its earnings in a bank in order to receive income not only in the form of wages, but also in the form of interest. This is how it is formed family wealth, i.e. the property they own, minus the debts the family incurred to acquire that property.

Income and wealth inequality can reach enormous proportions and pose a threat to the political and economic stability of a country. Therefore, almost all developed countries in the world are constantly implementing measures to reduce such inequality. But the development of these measures is possible only with the ability to accurately measure the degree of differentiation of income and wealth, as well as the results of influencing it through public policy.

To solve this problem, let's get acquainted with the method used to assess the scale of the first factor in the emergence of inequality - income differences. This method is named after its creator - the “method of constructing the Lorenz curve” (Fig. 2).

The shape of the Lorenz curve characterizes the degree of unevenness of income distribution. The steeper the curve and the further it is from the absolute equality curve, the greater the inequality in income distribution, and vice versa. By characterizing the amount of monetary income of various groups of the population, the Lorenz curve makes it possible to predict changes in people’s well-being, their purchasing power and, consequently, demand, this makes it possible to take the necessary measures to regulate and maintain equilibrium NPP. To build it, you need data on what part of families received this or that share of the country’s total income.

“Family share” is located on the x-axis, and “income share” is on the y-axis. The theoretical possibility of a completely equal distribution of income is represented by a bisector, which indicates that any given percentage of families receives a corresponding percentage of income. This means that if 20% of all families receive 20% of the total income, 40% - 40%, and 60% - 60%, etc., then the corresponding points will be located on the bisector.

So, the Lorenz curve shows the actual distribution of income. This curve is somewhat reminiscent of a bow, where the straight line is like a bowstring, and the underlying curve (Lorenz curve) is a slightly bent body. If the body of the bow were straight, attached to the string on one side only, and hanging vertically downward, then this would correspond to a situation of absolute inequality in the distribution of income. This is what the Lorenz curve would look like in a country where the richest 1% of families received 100% of all income. In this case, the Lorentz curve coincides with the axes of the coordinate system, forming a right angle with the vertex at the point f on the chart. The triangle formed by the diagonal and coordinate axes characterizes this extreme degree of inequality.

In reality, society always lives in the region between absolute equality and absolute inequality. The Lorenz curve clearly shows whether the actual distribution of income is closer to absolute equality or inequality.

Thus, income inequality - this is the price that society has to pay for accelerating the growth of the general level of well-being of all citizens of the country. But the need for such a “payment” never makes people happy. Against. The greater the differences in living standards between rich and poor, the greater the discontent of the latter. Economists have long established that differences in income become dangerous for social peace in a country if they:

becomes excessively large;

is growing too fast.

So, an important condition for social peace in any country is to prevent excessive differences in the incomes of the richest and poorest citizens. Government intervention is necessary to mitigate excessive income differentiation. This is achieved through progressive income taxation and social support systems. The mechanism for regulating income differentiation was created in developed countries of the world to resolve the contradiction between the unequal talent of people and the size of property, on the one hand, and the need to provide all people with at least a minimally decent lifestyle, on the other.

Income distribution informationin Russia in the past and current years

In the Russian Federation, the need arose to formulate a targeted and effective policy of individual incomes. The pre-reform period in Russia was characterized by strict government control, as well as administrative measures to influence the level of income of citizens. During the transition to a market economic system, there was a sharp drop in living standards and the formation of a deep stratification of society into rich and poor. Two levels of living with their own incomes and monetary units, two consumer markets, differing in prices and sets of consumer goods, were formed. Representatives of the “two Russias” do not understand each other well. And this is all the more dangerous because the “country of the rich and very rich (including “oligarchs”), as well as the highly wealthy” includes the political elite. At the opposite pole is “a country of poor people (including the marginalized),” whose incomes do not reach the subsistence level. The differences in living standards between the “two Russias,” according to expert estimates, reach 100 times.”

The existing legal and economic mechanisms in the sphere of income regulation not only do not solve the problem of combating inequality and poverty, but, on the contrary, reproduce the latter on an expanded scale. Thus, the legal norm regarding the establishment of a minimum wage, even in the new Labor Code of the Russian Federation, is not really linked to the subsistence level of the working population, and the application of the above-mentioned single (flat) tax on personal income, in fact, represents an inequality multiplier that operates on the principle of a “separator” centrifugal distribution of income by “fractions”: the incomes of the poor decrease, and the incomes of the rich increase. The originality of the action of this “separator” lies in the fact that the share of the population with average incomes decreases: at its expense, the share of the poor increases.

According to Rosstat, real disposable cash income (income minus mandatory payments, adjusted for the consumer price index) in September 2007 compared to the corresponding period in 2006 is estimated to have increased by 13.5 percent in January-September 2007 g. - by 12.4 percent. This data is provided by the Federal State Statistics Service.

The average accrued wages in September 2007, according to preliminary data, amounted to 13,801 rubles and compared to September 2006 increased by 24.7 percent.

The total wage arrears for the range of observed types of economic activity as of October 1, 2007 amounted to 4055 million rubles and increased by 0.9 percent compared to September 1, 2007.

The volume of overdue wages as of October 1, 2007 was 1 percent. monthly wage fund of workers in the observed types of economic activity; in education, health care and the provision of social services, cultural activities - 0.2 percent.

The initial task on a national scale in Russia is to increase the minimum wage to the subsistence level over the next one and a half to two years. This is due to the fact that the minimum wage in Russia is about 10% of the average wage in the country (for comparison: according to the ILO, the minimum wage in most countries of the world is 40-60% of the average wage and is several times higher than the physiological subsistence level minimum). This situation “unwinds the spiral of poverty”: workers whose wages are lower, approaching or even slightly higher than the subsistence level (and this is about 60% of the working-age population of Russia) do not have a chance to earn a pension that exceeds the subsistence level of a pensioner, i.e. inevitably face the prospect of a poor old age. It is clear that this situation destabilizes the pension system, shifts onto it problems that are fundamentally insoluble on its own, and complicates its reform, the need for which is extremely urgent.

table 2

For a more detailed and visual analysis of the average accrued wages in the Russian Federation, it is necessary to familiarize yourself with the cartographic data (see Fig. 3).

The average monthly nominal wage is calculated by dividing the accrued wage fund of employees by the average number of employees and by the number of months in the period.

The wage fund includes accrued amounts in monetary and non-monetary forms for hours worked and unworked, additional payments and allowances, bonuses and one-time incentives, compensation payments related to working hours and working conditions, as well as payment for food and accommodation, which is systematic.

Real wages characterize the volume of goods and services that can be purchased with wages in the current period, based on the prices of the base period. The real wage index is calculated by dividing the nominal wage index by the consumer price index for the same time period.

The main components of the population's income include wages, income from business activities, pensions, scholarships, benefits, social benefits; income from property, as interest on deposits, securities, dividends; income from the sale of agricultural products, insurance compensation, the amount from the sale of foreign currency and many others.

Based on the ratio of various components in the income structure, one can judge the type of economic system and work motivation.

Table 3. Composition of cash income of the population

The data presented in Table 3 show a certain share of income from business activities and a low share of wages in the income structure. It is also sufficient to note that an important role in work motivation is played by the proportions in which the shares of wages and social transfers are correlated. The consequence of the increase in the share of wages is the expansion of initiative and entrepreneurship. The opposite situation (a high share of social benefits) predetermines the development of a trend towards a decrease in incentives to work and indicates state paternalism in the sphere of income distribution and generation. In the Russian Federation, according to Table 3, the share of social transfers (12.0%) is small even compared to the small share of wages (64.9%). Therefore, there is no basis to prove the disincentive effect of social transfer payments in Russia.

In the Russian Federation, it makes sense to create conditions conducive to a further increase in income from business activities that are adequate to the market economic system. Due to the insignificant share of social payments, activation of the transfer payment system is required. Of no small importance is the government's influence on increased income from property, which forms the basis of social differentiation by income level.

Article 7 of Chapter 1 of the Constitution of the Russian Federation, adopted in 1993, states: “The Russian Federation is a social state, the policy of which is aimed at creating conditions that ensure a decent life and the free development of people.” This means that the state assumes responsibility for the socially fair distribution of income of the population, which implies a wide variety of regulatory methods.

In general, government guidance in the field of income distribution is carried out using legal, administrative and economic methods. It is logical to include various types of benefits provided by law for low-income categories of the population as automatically built-in income policy stabilizers. Discretionary regulatory stabilizers include an increase in benefits and the appointment of additional social payments and benefits.

Currently in the Russian Federation the priority strategic goals of income redistribution are:

long term strategy- bringing the level and quality of life of the population closer to the “standards of post-industrial society”

short-term- providing conditions for the social and physical survival of people, preventing a social explosion.

Conclusion

Changes in the economic life of the country have led to modifications in the consumer behavior of the population. Increased prices forced the population to sharply redirect their funds to the purchase of vital goods and services, primarily to the purchase of food; The usual relationships between the prices of individual goods, as well as between prices and incomes, have changed. This, in turn, required the organization of specialized statistical observations.

The influence of the “shadow” economy on the formation of household incomes in Russia is extremely great. Therefore, methods for quantitative measurements of this phenomenon and its impact on macroeconomic indicators must be developed and implemented.

The distribution of income of the population is of great importance, first of all, for analyzing living standards and developing adequate social and tax policies. However, its significance is not limited to this, since it provides information for studying the influence of household income on other macroeconomic processes, for example, for studying the factors that determine the savings rate and influence investment activity in the economy. Thus, income data is essential for governments making decisions on a wide range of economic policy issues, as well as for academics involved.

World experience shows that an effective socially-oriented market economy is unthinkable without a democratic system for distributing citizens' income. Distribution relations underlie the creation of a system of incentives for participation in the production process. The income of the population determines the social position in society, and the level of income of each person depends on the economy of the country in which he lives. Thus, the implementation of effective redistribution of income should be carried out through the development of government programs that provide for specific measures, primarily in the field of regulating citizens' incomes, fair taxation and improving the social protection system for citizens.

List of usedoh literature

1. Principles, problems and policies. McConnell Campbell R., Brew Stanley L. Economics. In 2 vols.: Per. from English 11th ed. - M.: Republic, 1995.

2. World Economy: Textbook for universities / Ed. Prof. I.P. Nikolaeva. - M.: UNITY, 2000.

3. Economic theory: textbook for universities / ed. Nikolaeva I.P., p. 492

4. Economics: textbook for universities / ed. Bulatova A.S., p. 606

5. Course of economic theory: Textbook for universities / ed. Chepurina M.N., p. 442

6. Official website of the Ministry of Finance of the Russian Federation - www. minfin.ru

7. Roik V. Pension reform. // Russian Economic Journal - 2000. - No. 9

8. http://www.finmarket.ru/z/nws/news

9. Russian Economic Journal - 2000. - No. 7 (p. 17 - 18)

10. Ponomarenko E. On fiscal policy for 2001. (Concept Analysis). // Economist. -2000. - No. 11. - With. 52

11. Official website of the State Statistics Committee of the Russian Federation, www.gks.ru

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Introduction

Assessing indicators of the dynamics and structure of income of the population is the most important element in the development of comprehensive forecasts. Income and purchasing power of the population are not only of social significance - as components of the standard of living, but also as factors determining the duration of life itself. They are very significant as an element of economic recovery, which determines the capacity of the domestic market. A capacious domestic market, secured by effective demand, is a powerful incentive to support domestic producers. 1

Low level of income, and, as a consequence, low purchasing power of the bulk of the population, is one of the main reasons for the stagnation of the economy of Kazakhstan.

It is obvious that in order to revive the economy, it is necessary to create effective demand through an increase in the share of household income in the total income of society - GDP. Basically, to revive the domestic market and support domestic producers, it is strategically important to increase the incomes of the poorest and middle part of the population. An increase and, of course, timely payment of wages, pensions, scholarships and other social benefits is necessary for economic growth.2 This is what justifies the relevance of considering this topic.

Relevance allows us to determine the topic of research - income distribution.

Based on the topic, we can identify the purpose of the study – income distribution and the problem of fairness in a market economy.

To achieve this goal, it is necessary to solve the following tasks:

Give the concept of population income, its structure and indicators;

Reveal the principles of income distribution in society;

Find out the problems of income inequality in society;

Identify problems in measuring income inequality, causes and factors of inequality;

Conduct observation and find out what is the degree of income distribution in the economy of Kazakhstan;

When solving the problems, methods such as observation, generalization, comparison, induction, and deduction were used.

The subject of the study is the fairness of income distribution.

The object of research is the market economy.

Methodology: this course work used the works of such scientists as: M.N. Chepurina, V.I. Vidyapina, L.M. Kulikova and others.

This course work consists of an introduction, sections 1 and 2, a conclusion and a list of references.

1. Theoretical foundations of income distribution and problems of justice in a market economy

1.1 Income distribution in a market economy

The level of people's well-being is characterized, first of all, by the income they receive. It is income that determines our opportunities for food and clothing, education and medical services; opportunities to visit theaters and purchase books, actively travel around the world, etc. The concept of income is broader than the concept of wages, since income can also contain other cash receipts.

Income of the population is the material resources available to the population to meet their needs.3 Income is considered at different levels, using three main indicators. (Annex 1):

Nominal income is the total amount of money received by (or credited to) individuals during a given period. The structure of this income includes such elements as factor income, that is, those obtained from the use of one’s own factors of production - wages, rent, interest, profit; payments and benefits through government social programs (transfers); plus other income - interest on bank deposits, dividends on shares, insurance amounts, lottery winnings, etc. (Appendix 2).

Unlike nominal, disposable income represents only that part of the nominal that can be used directly for personal consumption of goods and services, as well as for savings. In other words, disposable income is equal to nominal income minus taxes and other mandatory payments (contributions to the pension fund, social needs, etc.).

Real income reflects the purchasing power of our monetary income. It represents the quantity of goods and services (in value terms) that can be purchased with disposable income over a given period (that is, it takes into account possible price changes). In other words, this is an individual “consumption basket” available to each person (according to the income he has).4

The main sources of income for the majority of the population are wages and transfer payments. The relationship between them significantly influences the economic behavior of people. In particular, when earnings predominate in the income structure, this stimulates a person’s labor activity, his diligence, initiative, and entrepreneurship. When the role of transfers increases, people become more passive in relation to production activities and become infected with the psychology of dependency. Therefore, the directions and amounts of state social assistance must be thoughtful, balanced and strictly targeted.5

1.2 Principles of income distribution in society

Different countries and different periods have different systems for generating household income. Most often, the following four basic principles of distribution are distinguished (Appendix 3):

Equal distribution. It occurs when all members of society (or a certain part of it) receive equal income or benefits. This principle is typical for primitive societies, as well as for countries with a regime that Marx and Engels defined as “barracks communism.” In the literature you can find another, book name for this principle – egalitarian distribution. Since people differ in their abilities and energy, equalization of the remuneration of their labor inevitably gives rise to a situation where “one plants a vineyard, and another eats its fruits.”

Market distribution assumes that each of the owners of one or another factor of production (labor, entrepreneurial abilities, land, capital) receives a different income - in accordance with the economic utility and productivity of their factor. Thus, in relation to the owners of labor power (that is, hired workers), the well-known principle of distribution according to labor applies. It means that the amount of income of each worker depends on a specific market assessment of the significance of this type of work, as well as on its final results (how much, what, how and what quality is produced).

Distribution according to accumulated property. It manifests itself in the receipt of additional income by those who accumulate and inherit any property (land, enterprises, houses, securities and other property).

Privileged distribution is especially characteristic of countries with undeveloped democracies and civilly passive societies. There, rulers arbitrarily redistribute public goods in their favor, arranging for themselves increased salaries and pensions, improved living conditions, work, treatment, recreation and other benefits. Montaigne is right: “it is not need, but rather abundance that gives rise to greed in us.”

In reality, all four principles considered are often combined in different ways. For example, in the USSR, egalitarianism prevailed for the “working masses,” while various privileges existed for the top of the Communist Party (CPSU) and the state apparatus. While the “masses” experienced the hardships of low incomes, commodity shortages, overcrowded communal apartments, dormitories, basements, etc., the nomenklatura elite had high incomes, luxury apartments, cars, dachas, excellent food and living conditions. However, whatever the distribution system, in any modern society inequality of people’s incomes is inevitable.6

1.3 Problems of income inequality in society

Voltaire also reminded us that we have long ceased to live in that “golden age when people were born with equal rights and received an equal share of the juicy fruits of the uncultivated land.” Indeed, in a developed market, the existence of inequality is objectively determined by the fact that the market system is a dispassionate and rigid mechanism that does not know charity and rewards people only according to the final efficiency of their activities. People differ greatly from each other: in their hard work, activity, abilities, education, property ownership, and ability to spend their income productively. This means they cannot work, earn and live the same way.

And it is absolutely normal that the market, through its system of differentiated remuneration, objectively reveals the different capabilities of people, determining “who should be a doctor or a lawyer, who should collect garbage and sweep the streets.” The most ridiculous and harmful thing for humanity, says Ford, is to claim that all people are equal. They are very different, and the one “who creates a lot” must also “bring a lot into his home”, and vice versa. This is what “strict social justice, arising only from human labor,” consists of. There is no place for charity in wages. Everyone gets exactly what they deserve.

Another thing is the level of social policy of the state. It, as already noted, is designed to mitigate inequality in people’s incomes in order to prevent excessive social stratification and tension in society. However, too active government intervention in the redistribution and equalization of income significantly reduces the efficiency of production, since rising taxes suppress the interest of wealthy people in economic activity, and the poor, who receive more and more assistance, weaken the desire to find work and vigorous work.7

Thus, a contradiction inevitably arises between production efficiency and income equality (Appendix 4). Equality may seem fairer and more tempting, but it undermines the incentive to work. Moreover, excessive equalization of income creates its own injustice, benefiting the less able and less industrious at the expense of others.

Faced with this contradiction, each society must decide for itself two main questions: first, what is better: a larger pie, but divided into unequal portions, that is, an efficient economy, but inequality in society; or everyone equally, but from a smaller pie, that is, equality, but in an inefficient economy. Secondly, how does it see social justice: in the equal distribution of income or in equal opportunities to earn it.

Thus, social policy is a very subtle instrument of government regulation that requires very careful and flexible application. As for income inequality, it turns out that it is not only inevitable, but even necessary.8

2. Distribution fairness in a market economy. Justice concepts

Market distribution of income based on the competitive mechanism of supply and demand for factors of production leads to the fact that the remuneration of each factor occurs in accordance with its marginal product. Naturally, this mechanism does not guarantee equality in the distribution of income, and in reality, in countries with developed market economies, there is significant inequality in their distribution.

Within the framework of positive economic theory, there is simply no answer to the question of what kind of income distribution is fair.

Let us remember that the criterion of Pareto efficiency (when no market participant can improve his position without thereby worsening the position of others) cannot give us a theoretical basis for solving the problem of justice. One of the manifestations of the market fiasco is the impossibility of equitable distribution of income, since the market is a socially neutral mechanism. Pareto efficiency can be defined mathematically, but the concept of justice is a normative judgment, since the word “distribution” refers not only to the distribution of income, but also to the distribution of resources. That is why the issue of fair distribution of income does not leave either politicians or ordinary citizens indifferent: it raises a moral and ethical issue.

It is customary to distinguish between functional and personal distribution of income. Functional distribution means the distribution of national income between the owners of various factors of production (labor, capital, land, entrepreneurship). In this case, we are interested in what share of the “national pie” falls on wages, interest, rental income, and profit. Personal distribution is the distribution of national income among the citizens of a country, regardless of what factors of production they own. In this case, it is analyzed what share of national income (in monetary terms) is received by, for example, the poorest 10% and the richest 10% of families.

So, since Pareto efficiency does not give us any criterion for ranking points lying on the consumer opportunity curve (the achievable utility curve), we cannot say that the distribution at point A is fairer than at point B (Fig. 1).

The figure shows the achievable utility curve in society. We can argue that if there is a movement from point K to point M, then a Pareto improvement is observed. There was an increase in the utility of both y and x. But moving from A to B or vice versa, i.e. sliding along the achievable utility curve cannot tell us anything about the more preferable (from the point of view of fairness) position of each of the indicated points. 9

What does the concept of “justice” mean? Justice, according to the definition of the famous Macmillan Dictionary of Modern Economic Theory, is honesty and impartiality. If we consider justice in the context of the well-known theory of welfare economics, then a distribution that meets two conditions could be considered fair:

Firstly, it must be equal, i.e. none of the subjects of society prefers the commodity set of another person to his own commodity set;

Secondly, it must be Pareto efficient. At the same time, both equal and Pareto efficient distribution can be interpreted as fair. In general, social justice in economic theory is the problem of an acceptable degree of inequality in the distribution of income. And here it must be said right away that economic theorists do not have a single answer to this question. There are the most famous concepts of justice, or fair distribution of income: egalitarian, utilitarian, Rawlsian and market.

The egalitarian concept considers an equal distribution of income to be fair. The logic of reasoning here is as follows: if it is necessary to divide a certain amount of goods between people who equally deserve it, then an equal distribution would be fair. The problem is what do we mean by “equal merit”? Equal labor contribution to social welfare? Same starting conditions in terms of property ownership? Same mental and physical abilities? Obviously, we will not get a single answer to this question, because we again turn to moral judgments. But here it seems important to emphasize that the egalitarian approach is not as primitive as it is sometimes presented in journalistic articles by glib authors: take and divide everything equally, as suggested by the character of the famous story by Mikhail Bulgakov “Heart of a Dog” Sharikov. After all, we are talking specifically about the equal distribution of benefits among equally deserving people.

The utilitarian concept considers fair the distribution of income in which social welfare, represented by the sum of the individual utilities of all members of society, is maximized. Mathematically, this can be expressed in the form of a formula reflecting the utilitarian function of social welfare:

where W is the social welfare function, and and is the individual utility function. In our conditional example, the formula will take the form:

The above formula requires some clarification: firstly, the utilitarian approach presupposes the possibility of interpersonal comparison of the individual utility functions of various members of society. Secondly, individual utility functions, according to the utilitarian approach, can be:

are the same for all people;

different for different members of society. The latter refers to the different ability of people to extract utility from their income (cash or in kind). It is difficult to disagree with the fact that for a rich person the marginal utility of his money income is not at all the same as for a poor person. If you imagine yourself in the place of a millionaire, and then in the place of a humble office worker, then obviously the marginal utility of an additional monetary unit of income will be higher for the last named subject. Then it is assumed that the decrease in utility should be compensated during distribution not by exactly the same, but by a larger increment. This conclusion should not seem strange if we are talking about maximizing the sum of individual utilities.

To illustrate this approach graphically, we use an indifference curve. In the graph (Fig. 2), the social indifference curve means many combinations of utilities that these subjects can extract from their income, presented in cash or in kind. All combinations lying on the social indifference curve are equally satisfactory for society.

If the utilitarian social indifference curve is linear (and its slope is -1, as in case a), then the decrease in utility x will be compensated by exactly the same increase in utility y.

The individual utilities of income are exactly the same. If the social indifference curve is convex to the origin of the coordinate axes (option b), then we see that the decrease in utility for x must be compensated by a more than equal increase in utility y, since only in this way does the total utility of society as a whole remain unchanged. This means that members of society do not have the same individual utility function. Thus, according to the utilitarian approach, society can consider both equal and unequal distribution of income fair, depending on ideas about the nature of the individual utility functions of different members of society. It is easy to see that in case a) the utilitarian concept coincides with the egalitarian one: since all people have exactly the same ability to extract marginal utility from their income, then its equal distribution will be fair.

The Rawlsian concept is based on the assertion that a distribution that maximizes the welfare of the least well-off member of society will be considered fair. To justify his approach, John Rawls uses a specific mental construct known in economic theory as the “veil of ignorance.” The “veil of ignorance” means that when forming principles of equitable distribution, one must abstract from the possible consequences for one’s personal well-being. In other words, if it were possible to eliminate everything that is the result of chance or tradition, what kind of society would we choose if we were free to choose whatever we wanted? And what if we made our choice in interaction with other, equally free and equal people? For example, when deciding on rules for equitable distribution of income, you personally must throw a “veil of ignorance” over yourself and not take into account what you will become as a result of adopting such rules: an oil tycoon, a movie star, a postman, a teacher, a homeless person, etc. What would each member of society prefer in this case? Rawls argues that, under the “veil of ignorance,” everyone would prefer to insure against a possible fall into the abyss of poverty, and would therefore favor a distribution of income in which society would be concerned with maximizing the income of the least well-off members of society.

The Rawlsian social welfare function has the following form:

We are talking about solving the “maximin” problem, i.e. maximizing the welfare of a person with a minimum income. In other words, J. Rawls's approach means that the fairness of income distribution depends only on the well-being of the poorest individual. The Rawlsian social indifference curve will have the following form (Fig. 3).

Note that no increase in the welfare of one individual has an impact on the welfare of another. Social welfare, according to Rawls, improves only if the welfare of the least wealthy individual increases.

J. Rawls criticizes the utilitarian concept on several fronts:

First, utilitarianism in its original form provides the simplest and most straightforward concept of law and justice, i.e. maximization of the good, but does not particularly pay attention to how this sum of utilities is distributed among individuals (how exactly the gains of individual individuals compensate and cover the losses of others).

Secondly, Rawls suggests, the analogy between the individual and society is controversial. It turns out that just as an individual can choose the optimal combination between certain losses and gains (studying a difficult curriculum in order to later achieve a high position; taking part in certain unattractive activities that lead to gain in the future), so a society can exercise Tolerance of certain types of losses (inconvenience for some individuals) if they will lead to an increase in overall gain (greater benefit for more individuals).

But the problem with the utilitarian approach, according to Rawls's critical views, is that it violates the rights of individuals within society, i.e. uses some subjects as a means to achieve the goals of others. A typical example: the existence of the slave system in the southern United States before the Civil War, quite possibly, was in the interests of the nation as a whole (cheap labor, allowing the development of the textile industry, which ensured the United States a leading position in the world market). However, it is difficult to imagine how this could be reconciled with the principles of justice. Or, for example, sacrifices made in the name of future generations: a significant decrease in the standard of living or lengthening of the working day, which falls on the shoulders of the generation living today, certainly leads to an increase in the level of well-being of the future generation. But this, according to Rawls, is hardly fair.

The market concept considers fair distribution of income based on the free play of market prices, the competitive mechanism of supply and demand for factors of production. The distribution of resources and income in market conditions is carried out by an impersonal process. This method was not invented or created by anyone. It is in this sense that we must understand Hayek’s words: “Evolution cannot be fair.” Consequently, according to the thoughts of this outstanding representative of liberalism, “by suppressing the differentiation that arises as a result of the luck of some and the bad luck of others, the process of discovering new opportunities would be almost completely drained.”

So, the last of the considered concepts of justice again makes us think about whether the state should intervene in the process of income redistribution if the benefits in a free market economy go only to those who have “monetary votes”? The governments of industrialized countries did not wait for the end of theoretical debates regarding the equitable distribution of income, especially since in the debate on issues of a normative nature there was no one to make a judgment that has the status of absolute truth. Experience has shown that the existence of large areas of poverty is fraught with many negative consequences for stable and sustainable economic growth, law and order, moral health, etc. In essence, this is obvious within the framework of common sense and political pragmatism of leaders who do not want social upheavals in society.10

2.1 Measuring inequality of income distribution. Causes and factors of inequality

Before turning to the problem of measuring inequality in income distribution, it must be said that disposable income is the income of an economic entity received after paying transfers from the state and paying taxes from its personal income. It is disposable income that gives a more accurate idea of ​​the standard of living of the population than personal income.

Now, with the categories of personal and disposable income in mind, we can turn to specific problems of inequality in income distribution: what is the gap between rich and poor? And is it even possible to measure inequality in income distribution?

One of the most well-known ways to measure this inequality is to construct the Lorenz curve. We are talking about personal rather than functional distribution of income.

If we divide the entire population of the country into 5 parts (quintiles), i.e. 20% each, and the total income of society is also 20% each, then we can see that the line emanating from the origin of the coordinate axes (bisector) gives us an idea of ​​​​the equal distribution of income (Fig. 4).

The Lorenz curve is based on the calculation of cumulative shares (accumulated shares), and accordingly, the construction of a cumulative curve. On the x-axis we plot the first 20% of the population; then adding a second group, we get 40% of the population, then 60%, etc. On the y-axis we plot the cumulative values ​​of income: the first 20%, then 40%, then 60%, etc. If 20% of the population received 20% of total personal income, 40% of the population - 40% of income, etc., then we would construct just a bisector, called the line of absolute equality. But in reality the distribution is never absolutely equal. For example, the first 20% of the population receives 5% of income, 40% of the population receives 15% of income, 60% of the population receives 35% of income, 80% of the population receives 60% of income, and finally, 100% of the population receives 100% of all income of society. In accordance with these values, we construct a Lorentz curve, which deviates from the line of absolute equality. The Lorenz curve (OABCDE curve in our graph) will be more concave with respect to the bisector if the income distribution is more uneven. In Fig. 4 we can also see the line of absolute inequality running at right angles (OFE). The solid line of the Lorenz curve shows the distribution of personal income (before taxes and without transfers). But after paying taxes and receiving transfers, we can build a new Lorenz curve (dashed line), i.e. curve for disposable income. It is less concave, since as a result of redistribution processes, the initial inequality in income levels has decreased. Obviously, the more the Lorenz curve deviates from the bisector, the stronger the inequality in income distribution, and the more active the state’s social policy to equalize income, the less concave this curve is. Depending on the specific social programs and taxation systems in a particular country, the difference between the Lorenz curves constructed for personal and disposable income will depend. For example, in Fig. Figure 5 shows various Lorenz curves for Russia in 1997, reflecting the distribution of income from property, business income, income from labor (wages), etc.

As noted earlier, the Lorenz curve, which reflects the distribution of income taking into account transfer payments, comes closest to the line of absolute equality, and the furthest from it is the curve demonstrating the distribution of income from property.

Another indicator used in economics to determine the degree of income differentiation is the Gini coefficient (G), or income concentration index . This coefficient is closely related to the Lorenz curve. In Fig. 1.4 we can calculate it as the ratio of the area of ​​the figure located between the line of absolute equality and the Lorentz curve (denoted by the letter T) to the area of ​​the triangle OFE formed between the lines of absolute equality and absolute inequality:

where the value of G varies from zero to one, i.e.

It should be noted that the Gini coefficient can vary for different types of income and their subjects. The index can be calculated based on wages, income from business activities, GDP (GNP) per capita, gross household income, etc.

But why does income inequality exist? Various economists name many reasons and factors, but some of the most important are:

Firstly, from birth people are endowed with various abilities, both mental and physical. All other things being equal (this premise must always be kept in mind), a person endowed with exceptional physical strength has a greater chance of becoming a famous and highly paid athlete.

Secondly, differences in ownership of property, especially inherited property. People cannot choose which family they will be born into - hereditary millionaires or ordinary workers. Therefore, one of the types of income stream, i.e. income from property will vary significantly among the named entities.

Thirdly, differences in educational level. This reason itself largely depends on the first two mentioned. A child born into a rich family has a better chance of receiving an excellent education and, accordingly, a profession that brings high income than a child in a poor large family.

Fourth, even with equal opportunities and the same starting levels of education, greater income will be received by individuals who are sometimes called “workaholics.” These people are ready to take work home, stay at the workplace for long periods of time to resolve one or another professional problem, and ignore their poor health in order to achieve good results in their work.

Fifthly, there is a group of reasons that are simply associated with luck, chance, unexpected winnings, etc. In the conditions of uncertainty characteristic of a market economy, this group of reasons can explain many cases of inequality in income distribution.

Thus, at least for the above reasons, equality of economic opportunity is not always observed. Poor and rich still exist even in the most prosperous highly developed countries.11

3. Income distribution and the problem of justice in the economy of the Republic of Kazakhstan

Population incomes and their distribution are not only of social importance - as components of the standard of living, but also as factors determining life expectancy itself. Low income levels, and, as a consequence, low purchasing power of the bulk of the population, are one of the main reasons for the stagnation of the economy of Kazakhstan. 12

3.1 Population income statistics

Income of the population serves as the main source of satisfying personal needs for consumer goods and services, so the system of indicators of living standards begins with them. Statistics studies the amount and composition of income in the areas of their receipt and use. In the statistical study of population income, the most important is the social standard - the indicator of the minimum income, or subsistence level. The subsistence level is a level of income that allows you to purchase the minimum set of goods and services necessary to maintain health and maintain human life at a certain level of economic development. It includes the cost of food products based on the minimum volumes of their consumption, expenses for non-food goods and services, as well as taxes and mandatory payments.

The physical volume index of Gross Domestic Product (GDP) for January – June 2008 compared to the corresponding period of the previous year amounted to 105.4%. In the structure of GDP13, the share of goods production is 4 4.2%, services – 55.2%.

The statistical table “Gross Domestic Product for January-June 2008” is presented in Appendix 2.14

During the Soviet period, under the conditions of the administrative system of economic management, the main direction of the state's social policy was to maintain a relatively low, but fairly stable standard of living for the vast majority of the population. This was achieved, on the one hand, by strict rationing of wages and other types of income of the population, and, on the other hand, by “freezing” prices for basic types of consumer goods and paid services. As is known, a major role in the implementation of this policy was played by public consumption funds (PCF), which occupied more than 30% of the total income of the population and grew at a faster pace compared to wages. At the same time, about 75% of the total value of the physical labor force was formed and spent centrally, and the remaining 25% - at the expense of enterprises on the basis of strict directive standards.15 The system of distribution relations that emerged on this basis was essentially built on the denial of the commodity form of labor force assessment and was aimed to reduce the differentiation of workers' incomes.

The egalitarian approach to the distribution and provision of social guarantees, which did not create adequate incentives for highly productive labor and efficient accumulation, had exhausted itself by the 1980s. The need to eliminate the “leveling system” was one of the most important reasons for the start of perestroika in the USSR. However, during the implementation of market reforms in the USSR, Russia, Kazakhstan and other countries, the role of the state in generating household incomes and regulating wages decreased significantly, and there was a significant drop in the standard of living of the bulk of the country’s population.16

The practice of social development shows that increasing the level and quality of life is not only the result of economic growth, but also its condition. Modern production requires both fundamentally new equipment and technologies, as well as highly qualified workers, owners of their intellectual capital, who form the basis of the middle class. Such people have a much more complex structure of material, spiritual and social needs; they spend more money on restoring vital energy, education and vocational training. Their level and quality of life must be higher than simply ensuring survival. 17

Introduction

The relevance of the topic is due to the fact that in the conditions of a changing economic system, the established mechanism of income distribution is undergoing radical changes. On the other hand, the mechanism of income distribution itself significantly influences both the development of the sphere of material production (determines its structure, dynamics and rates of economic growth) and non-material industries.

The transitional stage of development of the Russian economy is characterized by intensified processes of socio-economic stratification of the population by income level. The desire to maximize one’s income dictates the economic logic of behavior for any market subject. Income is the ultimate goal of the actions of every active participant in a market economy, an objective and powerful incentive for his daily activities. But high personal incomes are beneficial not only to the individual, it is also a socially significant benefit, since they are ultimately the only source of satisfying general needs, expanding production, as well as supporting the low-income and disabled.

Income is a monetary assessment of the results of the activities of an individual (or legal entity) as a subject of a market economy. In economic theory, income means a sum of money that regularly and legally comes to the direct disposal of a market subject. Income is always represented by money. This means that the condition for receiving it is effective participation in the economic life of society: we live on a salary or through our own entrepreneurial activities, in any case we must do something useful for other people. Only then will they transfer to us part of the money at their disposal (just as we do not part with our money without acquiring in return something useful specifically for us). Consequently, the very fact of receiving monetary income is objective evidence of the participation of a given person in the economic life of society, and the amount of income is an indicator of the scale of such participation.

The direct dependence of income on the results of market activity is violated only in one case when it is objectively impossible to participate in it (pensioners, young people of working age, disabled people, dependents, the unemployed). These categories of the population are supported by the entire society, on behalf of which the government regularly pays them cash benefits. These payments, of course, form a special element of total income, but, strictly speaking, they are not market ones.

Market income is always the result of our efforts that are useful to other people. This means that it is largely determined by the coincidence of the goods and services we offer with the demand presented by other people. The interaction of supply and demand is an objective mechanism for the formation of income in a market economy. Of course, in such a mechanism there are elements of random and therefore unfair, but there is no other way to generate income in a market economy.

The purpose of the work is to explore the concept and essence of income distribution in a market economy.

Based on the goal, the following tasks will be solved:

concepts such as functional and vertical incomes, indicators of population income, the Lorenz Curve and the Gini coefficient have been studied;

the conditions for the distribution and redistribution of income are considered;

the role of the state in the mechanism of income distribution is revealed.

The object of this work is the mechanism of income distribution in a market economy.

The subject of the work is distribution relations in a market economy.

The methodological and theoretical basis of the work is made up of fundamental concepts presented in classical and modern works of domestic and foreign scientists implementing political-economic and institutional approaches to the analysis of income distribution.

1. Income generation in a market economy

.1 Concept and types of income

redistribution income market economy

In a market economy, “income” refers to any type of regular or one-time amounts of money at the disposal of an individual per unit of time (week, month, year). The market system of income generation differs significantly from the centralized system, in which, at least theoretically, no other way of generating income is allowed, except in accordance with the labor contribution of each citizen. Such a socially just approach is absolutely not characteristic of a market system. It recognizes as normal and acceptable any income received as a result of participation in free competition in the markets of goods, services, capital and labor. In other words, the high incomes of those who succeeded in competition and the low incomes (or even lack thereof) of those who failed in it are recognized as equally fair and acceptable. Moreover, low income may not be the result of insufficient labor efforts of producers, but of changes in market conditions, which have little dependence on the ordinary participant in market competition.

It may seem that this principle of generating income does not apply to everyone. After all, there are large categories of people whose incomes are fixed. For example, these are persons employed in the field of fundamental science, in the government apparatus, employed people, etc. However, a closer examination reveals that the incomes of these categories of workers still depend to a large extent on competition in the labor market of a particular profession, the current state of the economy, the financial capabilities of the state, etc. As a result, even an employee who performs his professional duties well may lose his permanent income for reasons completely beyond his control.

It follows from this that the market principle of income generation itself is weakly related to the principle of social justice in the sense in which mass consciousness understands it.

On the other hand, it is impossible to deny that in the 21st century. at the modern, very high level of development of productive forces, every person can count on the realization of the most important socio-economic right to a known minimum standard of well-being, ensuring him a decent existence, regardless of the forms and results of economic activity.

Modern economic theory considers the formation of income in accordance with the functioning factors of production: labor, land, capital, entrepreneurship. Labor as a factor of production brings its owner income in the form of wages, land in the form of rent, capital in the form of interest, and entrepreneurial activity in the form of profit.

In the functional distribution of income, the determining aspect is the aspect of remuneration for the use of factors of production. Based on what shares of total income go to each individual household, we can talk about personal income distribution. For a single individual household, the amount that it has to satisfy its demand for a certain period of time is of particular importance.

In a modern market economy, the bulk of society's total income is expressed in “wages” and “salaries.” However, society consists not only of owners of factors of production. There are categories of the population that, for objective reasons, do not have the opportunity to participate in social production as the owner of a certain factor (pensioners, young people of working age, disabled people, the unemployed). In order for these categories of the population to be provided with certain incomes, the owners of production factors transfer part of their income to the state. Thus, the state carries out a redistribution of income, which is called “vertical income distribution.”

A significant portion of income in a market economy is of labor origin. These are the incomes of workers and other wage earners. However, the income of entrepreneurs, not to mention managers, brokers, and farmers, is also largely labor in nature. True, isolating this component in their total income is theoretically very difficult, and practically impossible. The fact is that their income is determined not only by the degree of labor diligence, but also by such difficult-to-predict factors as luck, the ability to take risks, the ability to analyze and anticipate fluctuations in market conditions in the field of production, services, stock trading, etc. In addition, it must be borne in mind that the results of the labor of these economic entities receive their recognition not a priori (before the production process), but only as a result of the sale of a product or service on the market, i.e. after its social utility has been recognized. That is why the market distribution of income contains, along with other factors, elements of distribution by labor. In any economy, one of the most important and most widespread forms of income is wages. In the market price system, wages are a particularly important category, since they reach approximately 3/4 of the national income of developed countries. The regulation of many processes in the economy is associated with the movement of wages. There are several concepts on the issue of the essence of wages in economic theory. One of them was laid down by the classics of English political economy A. Smith and D. Ricardo. A. Smith did not make a clear distinction between labor and labor power. He believed that a commodity is labor, which has a natural price (or “natural wage”). It is determined by production costs, i.e. the cost of the necessary means of subsistence for the worker and his family. In addition, wages include a historical and cultural element - this is how A. Smith explained the existence of national differences in wages. D. Ricardo, like A. Smith, believed that wages are the price of labor. But he argued that rising wages stimulate births in working-class families, which leads to increased labor supply and lower wages; on the contrary, a decrease in wages causes a reduction in the number of workers and the supply of labor, and therefore leads to an increase in wages. Thus, under the influence of fluctuations in labor supply, wages tend to some constant value - the physical minimum of means of subsistence. Another concept of wages, developed by K. Marx, is based on the distinction between the concepts of “labor” and “labor power”. According to Marxist theory, labor is not a commodity and has no value. This is determined by the fact that labor is a process of consumption of labor power and does not exist before this process itself. The commodity is labor power, and wages are the price of this commodity, i.e. monetary expression of its value. In the form of wages, the worker receives payment not for all labor, but only for the necessary labor, which embodies the fund of human subsistence. The amount of wages depends on the conditions of production and reproduction of labor: on the level of productivity, intensity, and complexity of labor, which affect the cost of labor. Wages depend on market conditions - on the relationship between the demand for labor and its supply. Since a worker receives wages after completing a certain amount of work, wages are perceived as the price of labor. Therefore, K. Marx called it a transformed form (i.e., a form that distorts the essence) of value and, accordingly, the price of labor power. Modern economic theory views wages as the price paid for the use of labor, in other words, for labor services provided by workers in a variety of professions, taking into account market conditions. Based on the neoclassical concept (J. Perry, M. Feldstein, R. Hall), and since the 80s it has also been supported by supporters of supply-side economics (D. Gilder, A. Laffer, etc.), the labor market is defined like all others markets where the price equilibrium mechanism operates. The main market regulator is price - in this case, labor force (wages). Thanks to it, the demand and supply of labor is regulated and their balance is maintained. From the neoclassical concept it follows that the price of labor reacts flexibly to market needs, increasing or decreasing from supply and demand, and unemployment is impossible if there is equilibrium in the labor market. Therefore, the thesis is put forward about the supposedly voluntary nature of unemployment. But the main question that the proponents of this approach do not answer is why do not all hired workers, if their supply exceeds demand, offer their labor at a lower price? Unlike neoclassicalists, Keynesians (J.M. Keynes, R. Gordon, etc.) and monetarists (M. Friedman, etc.) view the labor market as a phenomenon of constant and fundamental disequilibrium, since the price of labor (wages) is rigidly fixed , practically does not change (especially downward). Therefore, the regulatory role of the state is justified, aimed at aggregate demand, otherwise - the volume of production. Monetarists proceed from a rigid structure of labor prices, moreover, from the premise of their unidirectional, upward movement. They introduce a special concept of the “natural” level of unemployment, reflecting the structural characteristics of the labor market, making prices inflexible, preventing its normal functioning, exacerbating its disequilibrium and, therefore, unemployment. To balance the market, monetarists propose to use monetary policy instruments, in particular such levers as the central bank discount rate and the size of required reserves of commercial banks in the accounts of the central bank. Representatives of the institutional direction J. Dunlop, L. Ullman and others focus on the analysis of professional and sectoral differences in the structure of the workforce and the corresponding wage levels. Here we can see a departure from macroeconomic analysis and an attempt to explain the nature of the market by the dynamics of individual industries and professional demographic groups. There are nominal and real wages. Nominal wage refers to the amount of money that a wage worker receives for his work. By the size of the nominal wage one can judge the level of earnings and income, but not the level of consumption and well-being of a person. To do this, you need to know what the real wage is. It expresses the mass of vital goods and services that can be purchased for the money received; it is directly dependent on the nominal salary and inversely dependent on the level of prices for goods and services. In addition, the salary depends on the professionalism and type of work performed. Differences in wages are determined by the quality of the functions performed, as well as by the fact that the work can be pleasant and unpleasant, complex and simple, mental and physical, etc. It should also be said about national differences in the amount of wages of workers, which depends on the scientific and technical level of the productive forces and the efficiency of social labor, the degree of development of the labor force, the achieved socially normal quality of life and other factors. Wages exist in two main forms - time-based and piece (or piecework). Time wages set the amount of remuneration based on the time worked. In this case, the amount of payment for 1 hour, day, week, month is calculated and multiplied by the time worked. A derivative of time wages is piecework wages, or piece wages. It is calculated depending on the volume of products produced. When paying by the piece, earnings increase in direct proportion to the volume of products produced. Currently, various additional payments have begun to play an increasingly important role in the wages of employees. In a number of countries, such sources of additional income as participation in profits, in the “success of the enterprise,” in its shares, which is associated with “diffusion of property,” and in the accumulation of funds in special accounts, have acquired considerable importance. In addition, for many categories of workers and employees, earnings from a “second job” are added to the wages at the main place of work, self-employment is usually not officially declared and, therefore, eludes the payment of taxes and contributions to social funds (both for the employed themselves and from employers).

A major role in a market economy is played by income that is not directly related to labor contribution, that is, the so-called “unearned income.” This is a complex and varied category of income, which can be divided into legal and criminal. Legal unearned income includes dividends on stocks, the difference in the market value of shares when buying and selling, interest on bonds, interest on current bank accounts, profits from speculative transactions with securities, profits from the difference in the purchase and sale of goods wholesale and retail. in various local markets, etc. It should be clear that trying to “cleanse” the market economy of these and other types of legal unearned income is completely unrealistic. To do this, it will be necessary to ban joint stock activities, the securities market, close the loan capital market and, in general, all private entrepreneurial activity. However, our own experience irrefutably demonstrates that it is still not possible to try to establish the distribution of income solely based on labor. This is hampered primarily by the fact that, apart from the market, there is no objective mechanism for measuring the quantity and quality of various types of labor. Therefore, the attempt to manage the distribution of income without the market in practice turned out not to be the desired social justice, but to voluntarism, equalization and privileged systems of distribution in kind. As noted above, income can be not only legal, but also illegal. They can be divided into two main types. Income of general criminal origin (corruption, racketeering, drug trafficking, smuggling, etc.) depends little on how the official economy is structured. The social danger of such activities is generally recognized throughout the world and is subject to criminal prosecution. Another part of criminal income is generated precisely by the structure of the official economy. For example, in the former USSR, a typical type of “shadow” economic activity was speculation, i.e. resale of scarce goods at prices significantly higher than government prices. Speculation is a consequence of severe deformation of market processes that give rise to suppressed inflation, and with it a “black market” of enormous capacity. This kind of shadow income is not typical for a market economy, because in it commodity shortages are not the rule, but a rare exception. Shadow income in market structures has a different origin. They are widespread, for example, counterfeiting trademarks of world-famous companies, clandestine use of labor, discrimination in wages, obtaining and implementing lucrative contracts with the help of corrupt officials, etc. The shadow economy and related illegal income exist in all countries. But its scale is not the same. In Europe, the sad leader in this regard is Italy, where the shadow sector, according to experts, covers about 30% of the gross national product. In other developed countries, the volume of shadow economic transactions is more modest (from 3 to 10% of GNP). In Russia, according to some estimates, this share ranges from 25% to 47% of GNP. The reality is that it is almost impossible to completely defeat the shadow economy and the income associated with it. The only thing that can and should be done is to limit the scale of this sector of the economy in every possible way. Also, the main types of income include government income and household income. State revenues are understood as a system of economic relations, in the process of which a set of funds is formed that comes into the ownership of the state to create the material basis for its functioning. The economic nature of state revenues and their organizations are determined by the economic system, political and economic role of the state. Each socio-economic formation is characterized by its inherent system of state revenues, determined by the level of development of commodity-money relations, the method of production, the nature and functions of the state. The formation of state revenues is carried out with the most active participation of the state - it establishes the share of net income, centralized in the budget and left to business entities, and also concentrates part of the personal income of the population and other funds of society. The classification of state revenues allows us to better understand their economic nature, composition and target orientation, principles of formation, that is, the entire system of state revenues. Depending on the organizational and legal form of ownership, state revenues consist of:

.income of state enterprises and organizations;

.tax revenues of the private business sector;

.tax revenues of public and collective organizations;

.tax payments of the population.

Depending on the areas of creation, government revenues are classified into:

.income generated in the sphere of material production;

.income generated in the intangible sphere.

Household income is part of the national income created in the production process and intended to satisfy the material and spiritual needs of household members. This type of income should compensate for labor costs, that is, all the mental and physical aspirations of people fulfilled in the process of producing certain goods and services. However, in modern society, due to the uneven distribution of national income, the resources of certain categories of households are insufficient to maintain vitality at the required level. And for this purpose, the state replenishes household funds from the budget. Gross household income is cash income, the price of in-kind food receipts and benefits and subsidies provided by the state and enterprise in kind. Gross income is dominated by cash income that a household has to cover its expenses. Cash income is generated from the following sources:

.wages of household members;

.income from business activities;

.state social payments;

.other supply.

1.2 Income indicators

The level of income of members of society is the most important indicator of their well-being, as it determines the possibilities of an individual’s material and spiritual life: recreation, education, maintaining health, meeting basic needs. Among the factors that have a direct impact on the amount of income of the population, in addition to the size of wages themselves, are the dynamics of retail prices, the degree of saturation of the consumer market with goods, etc.

To assess the level and dynamics of income of the population, indicators of nominal, disposable and real income are used.

Nominal income (NT) is the amount of money received by individuals during a certain period; it also characterizes the level of monetary income regardless of taxation.

Disposable income (DI) is income that can be used for personal consumption and personal savings. Disposable income is less than nominal income by the amount of taxes and mandatory payments, i.e. These are funds used for consumption and savings. To measure the dynamics of disposable income, the indicator “real disposable income” is used, calculated taking into account the price index.

Real income (RI) - represents the amount of goods and services that can be purchased with disposable income during a certain period, i.e. adjusted for changes in price levels.

Thus, an increase in nominal income by 8% with an increase in the price level by 5% gives an increase in real income by 3%. Nominal and real income do not necessarily move in the same direction. For example, nominal income may rise while real income may fall at the same time if commodity prices rise faster than nominal income.

The desire to maximize one’s income dictates the economic logic of behavior for any market subject. Income is the ultimate goal of the actions of every active participant in a market economy, an objective and powerful incentive for his daily activities.

But high personal incomes are beneficial not only to the individual, it is also a socially significant benefit, since they are ultimately the only source of satisfying general needs, expanding production, and supporting low-income and disabled citizens.

Recipients of market income are always concerned with three questions: the reliability of its sources, the efficiency of using income and the justification of the tax burden. Economic theory answers these questions by examining education and the movement of total income.

Income is a monetary assessment of the results of the activities of an individual (or legal entity) as a subject of a market economy. In economic theory, “income” means a sum of money that regularly and legally comes to the direct disposal of a market entity.

Income is always represented by money. This means that the condition for receiving it is effective participation in the economic life of society: we live on a salary or through our own entrepreneurial activities - in any case, we must do something useful for other people. Only then will they transfer to us part of the money at their disposal (just as we do not part with our money without acquiring in return something useful specifically for us).

Consequently, the very fact of receiving monetary income is objective evidence of the participation of a given person in the economic life of society, and the amount of income is an indicator of the scale of such participation. After all, money is perhaps the only thing in the world that cannot be given to oneself: money can only be received from other people.

The direct dependence of income on the results of market activity is violated only in one case - when it is objectively impossible to participate in it (pensioners, young people of working age, disabled people, dependents, the unemployed). These categories of the population are supported by the entire society, on behalf of which the government regularly pays them cash benefits. Of course, these payments form a special element of total income, but, strictly speaking, they are not “market” payments.

Market income is always the result of our useful - for other people - efforts. This means that it is largely determined by the coincidence of the goods and services we offer with the demand presented by “other people”. The interaction of supply and demand is an objective mechanism for the formation of income in a market economy, including the income of the population. Of course, in such a mechanism there are elements of random and therefore unfair, but there is no other way to generate income in a market economy.

Nominal monetary incomes of the population are formed from various sources, the main of which are: factor incomes; cash receipts through government assistance programs in the form of payments and benefits from the financial system (from banks, through savings banks, from insurance institutions, etc.), etc.

The funds received by the employed population in order to remunerate the owners of the factor of production (labor) make up the decisive part of the income of this group of the population - wages, income such as wages at enterprises, in cooperatives, etc., income from their own farm, etc. An analysis of trends in the long-term development of labor factor remuneration indicates that this type of income will retain its leading role in the formation of the total volume of cash income in the long term.

Payments under government assistance programs have a significant impact on the formation of the population's income; these sources provide pensions, support for temporarily disabled citizens, and pay various types of benefits (for child care, medical care, for low-income families for children; unemployment benefits).

The ratio of the share of transfer payments and wages in the population's income plays an important role in shaping the economic behavior of an individual and his work motivation.

With the dominant role of wages in the formation of the total amount of income, such qualities as entrepreneurship and initiative are formed. If the role of payments through government assistance programs increases, a passive attitude towards production activities and the psychology of dependency often develop.

Cash income of the population received through the financial and credit system is presented as:

state insurance payments;

bank loans for individual housing construction, economic establishment for young families, members of consumer associations (for example, for garden construction);

interest on deposits in savings banks accrued at the end of the year;

income from increases in the value of shares, bonds, winnings and loan repayments;

lottery winnings;

temporarily available funds resulting from the purchase of goods on credit;

payments of various types of compensation (injury, damage, etc.).

Other cash receipts include income from the population from the sale of things through consignment and buying stores, etc.

Nominal income of the population, as already noted, includes, in addition to net income of the population, mandatory payments. The population makes obligatory payments through the financial system in the form of various taxes and fees. Through the accumulation of tax payments and fees, the state exercises its right to generate part of its resources for the subsequent implementation of social policy through the redistribution of funds and assistance to low-income citizens. In order to protect the interests of low-income citizens and prevent the level of well-being from falling below the maximum permissible in given specific conditions, the state sets a threshold minimum for tax-free income. At the same time, progressively higher tax rates are set for high incomes.

Despite the diversity of sources of income, the main components of cash income of the population are wages, income from business activities and property, as well as social transfers.

2. Income distribution in a market economy

2.1 Distribution and redistribution of income

Since the costs of production fall on the shoulders of the owners of the production factors of production, initially the income is concentrated in their hands. This is a functional distribution of income, during which the wages of employees (owners of the “labor” factor), the profits of large entrepreneurs, company owners (owners of capital), rent (the income of land owners and homeowners), the income of small owners (a combination of wages, profits, interest) are formed. , dividends and rent). These types of income are of a market nature, since their size largely depends on the relationship between supply and demand for a particular factor of production.

During the transition to a market economy in Russia, significant changes occurred in the structure of monetary incomes of the population. New forms of income are being formed and intensively developing: from entrepreneurship and from property (interest, dividends, rent, proceeds from the sale of securities).

The ratio of the share of wages and social transfers in the monetary income of the population plays an important role in work motivation. When wages predominate in the formation of total income, entrepreneurship and initiative usually develop, while when the role of social transfers increases, the psychology of dependency often increases.

Differences in income per capita or per employee are called income differentiation. Income inequality is common to all economic systems. The largest income gap was observed in the traditional system. This gap was greater than in the era of free competition capitalism. Then, during the transition to a modern market economy, differences in income (and property) levels decrease markedly. During the transition from an administrative-command to a market system, the growth of income differentiation is associated with the fact that part of the population continues to live in the conditions of the disintegrating previous system and at the same time a social stratum emerges that operates according to the laws of a market economy. As more and more sections of the population become involved in market relations, the extent of inequality is reduced.

The amount of income of each interval group is determined based on the distribution curve of the population according to the size of the average per capita income by multiplying the middle of the income interval by the population in this interval.

For the transition economy of Russia in the first half of the 90s. was characterized by an increase in income differentiation indicators.

The functional distribution of income is very rigid. Income differentiation depends in this case not only on the level of qualifications of participants in market relations, but also on what they inherited. These functional incomes may be completely unrelated to labor participation in production (for example, rent, interest on a deposit deposited in a bank, dividends from securities owned by a person, etc.). As a result of functional distribution, some groups of the population (children, the elderly, the unemployed), who do not have access to the disposal of factors of production, are doomed to a half-starved existence in countries with market economies, if not for the role of the state, which redistributes the income accumulated by direct participants in market relations. This is how the vertical distribution of income is formed. The main difference between the functional distribution of income and the vertical one is that the first is determined by the ownership of factors of production, the second is the result of state intervention in the sphere of distribution and redistribution of income. It is this that characterizes the actual distribution of income across groups and social strata of the population (this is called the “property hierarchy”), which is where its name comes from - “vertical distribution of income.”

The state directly intervenes in the primary distribution of monetary income and often sets an upper limit on the increase in nominal wages. The economic importance of state regulation of wages is determined by the fact that its change affects aggregate demand and production costs. Income policy is used by the state to restrain wage growth in order to reduce production costs, increase the competitiveness of national products, encourage investment, and curb inflation. The state, pursuing an anti-inflationary policy, can temporarily establish a long-term limit for wage growth in a centralized manner, taking into account the general needs of economic and social development.

Methods for implementing income policy in market and transition economies may be different. Preference is usually given to methods of voluntary consent of employers and employees with the participation of the government, which does not exclude the use of administrative measures of state control over linking wage increases with the financial capabilities of the enterprise. In a number of Western European countries, there are so-called permissible limits for its increase, fixed in national social partnership programs.

The most effective means of state regulation of wages in countries with market economies is the determination of a guaranteed minimum (or rate). It is on the basis of the minimum wage that negotiations are being conducted between company managers and trade unions on the conclusion of collective agreements at various levels, from enterprises to industries. These documents also stipulate various bonuses and additional payments, differentiation of wages by industry, depending on the level of qualifications.

In Russia, since 1991, a periodically revised minimum wage (minimum wage) has been in force. In conditions of high inflation in the first half of the 90s. This indicator has lost connection with the subsistence level.

Inflation has a significant impact on the level of real income of the population. Therefore, one of the most important conditions for rational government regulation of income is to take into account rising prices for consumer goods (including tariffs for services to the population).

2.2 State policy of income redistribution: principles and boundaries

One of the functions of the state is related to the redistribution of income, which fits within the maximum limits of its intervention in the real market. Distribution policy is an important area of ​​activity for any state, and the economics of the public sector, of course, has no right to abstract itself from it. The problem, however, is that not only large communities that are not similar in their culture, traditions, and beliefs, but also many individuals within each of these communities have unequal ideas about the desirability and fairness of various distribution options. There are conflicts of values ​​and interests that economics cannot completely eliminate.

The forced reallocation of resources resorted to by the state usually leads to multidirectional changes in the level of well-being of individuals. While it brings benefits to some members of society, it entails losses for others.

This occurs primarily in cases where laws and policies require transfer payments to be made. A transfer payment is a gratuitous transfer of part of the income or property of an individual or organization to the disposal of other persons. Transfers are, for example, benefits paid to those in need by taxing individuals with relatively high incomes.

Transfers can be carried out voluntarily, acquiring the character

donations. But in practice, the predominant part of transfers is related to government activities.

Social transfers are a system of measures of monetary or in-kind assistance to the poor, not related to their participation in economic activities at the present time or in the past. The purpose of social transfers is to humanize relations in society, prevent the growth of crime, and also maintain domestic demand.

At the same time, redistribution processes are not limited to the direct transfer of money, goods and services. Economic opportunities may also be redistributed. Redistribution occurs, for example, due to government regulation of wages, prices, customs tariffs and other economic variables. As a result, some members of society gain advantages, while others have reduced income opportunities.

The state, organizing the redistribution of income through the budget, solves the problem of increasing the incomes of the poor, creates conditions for the normal reproduction of the labor force, helps to ease social tension, etc. The degree of influence of the state on the process of income redistribution can be measured by the volume and dynamics of expenditures for social purposes at the expense of the central and local budgets, as well as the amount of income taxation.

The state's ability to redistribute income is largely limited by budget revenues. Increasing social expenditures in excess of tax revenues leads to their transformation into a powerful factor in the growth of the budget deficit and inflation. An increase in social expenditures of the state budget, even within the limits of revenues received, leads to an excessive increase in taxes, which can undermine market incentives.

The mechanism of social transfers includes the withdrawal of part of the income in the form of taxes from the middle and high-income segments of the population and the payment of benefits to the most needy and disabled people, as well as unemployment benefits. The government also redistributes income by changing market prices, such as guaranteeing prices to farmers and imposing minimum wages.

The very structure of a market economy makes government intervention in the sphere of income inevitable with the aim of redistributing it. Thanks to this, the government receives the funds necessary to meet general needs (defense, ecology, development of production and social infrastructure), material support for those temporarily unemployed in production, the disabled (the elderly and youth), as well as low-income groups of workers. In addition, society is responsible for the level of income of workers employed in the “public” sector of the economy (budgetary industries), whose income (wages and salaries) are fixed. This is usually achieved by legislatively establishing a minimum level of wages as a mandatory wage base in all spheres of the economy. The minimum wage must provide a minimum standard of welfare. In Russia, its value is now approximately 5025 rubles.

The government carries out income redistribution in direct and indirect ways, including:

· “transfer payments”, that is, benefits paid to low-income groups, dependents, disabled people, the elderly and the unemployed;

· “price regulation” for socially important products;

· “indexation” of fixed income and transfer payments at a statutory inflation rate;

· “mandatory minimum wage” as the base for remuneration at all enterprises;

· “progressive taxation”, in which the tax rate increases as nominal income increases.

Changes in the tax system and interest rates are two powerful tools that the government has at its disposal to regulate the behavior of income earners in a market economy. Taxes determine the amount of real personal income, and the interest rate, influencing the amount of savings, determines the size of the “consumed” part of income and, thereby, the amount of real (“effective”) demand.

An important element of state regulation of income is the determination of the lower and upper limits of nominal wages. Such a limit should prevent the development of a price-wage inflation spiral. This measure forms the main element of the “policy of containment”, meaning in practice a “freeze” of wages and prices (as opposed to the “policy of expansion” when the growth of household incomes is stimulated). The containment policy limits the inflationary excess of effective demand over the volume of realized aggregate supply.

Realizing the special social significance of income redistribution to ensure the stability of a market society, the government seeks, however, to avoid two extremes: the formation of dependent attitudes among the poor and the undermining of the desire for highly profitable activities among the economically active part of society.

One of the main directions of state income policy is the protection of cash income (wages, pensions, benefits) from inflation. For this purpose, indexing is used, i.e. an increase in nominal income depending on rising prices.

A comprehensive indexing system developed in the 60-70s. in most Western European countries. Typically, indexation is carried out both at the national level (based on relevant legislation) and at the level of individual enterprises through a collective agreement. The indexation system provides for a differentiated approach depending on the amount of income: from full compensation for the lowest to close to zero compensation for the highest.

In most industrialized countries, indexation applies to a smaller portion of the working population (for example, in the United States - to just over 10% of employees, while the rest prefer to achieve certain wage increases when revising collective agreements). However, indexation is widely used to maintain the standard of living of pensioners and other persons with fixed incomes.

To calculate the consumer price index, due to large fluctuations in the prices of various goods and services, especially during periods of high inflation, a representative set of goods and services is very important. The most common disputes between government agencies and trade unions are over the inclusion in the index of expenses for rent, food, clothing, shoes, transport and recreation. At the same time, it is believed that the consumer price index usually understates the increase in the cost of living or establishes underestimated shares of expenses for certain items of the consumer budget.

Is market generation of income fair? What to prefer - market distribution of income, adjusted by government regulation, or government distribution, adjusted by the market?

The desire for income equality, which, in the opinion of many, embodies social justice, is always accompanied by a drop in economic efficiency, because there is no need for either the “poor” (society will support it anyway) or the “rich” (society will take it away anyway) to work effectively.

Income inequality ensures economic efficiency, but is accompanied by social injustice in the form of significant property differentiation of society.

Thus, the choice between equality and income inequality becomes a choice between “social justice” and “economic efficiency.”

Of course, the “market” distribution of income is unfair, but it is at least able to compensate for this injustice with economic efficiency of production, providing a total product in an amount sufficient to support the poor in the form of transfer payments and large social programs (this is a “socially oriented market economy” ).

A fair distribution of income means (and this has already been proven by practice) undermining incentives for effective work and usually ends with the fact that there is simply nothing left to distribute fairly.

From these positions, we have to admit that “unfair economic efficiency” today has an objective advantage over “ineffective social justice.” And although their convergence constitutes the content of socio-economic progress, in the foreseeable historical period the named alternative retains its rigid unambiguity.

To determine the degree of income inequality, the “Lorenz curve” and the “Gini coefficient” are used, showing what share of total income falls on each population group, which allows us to judge the level of economic inequality in a given country.

The Lorenz curve shows the degree of inequality in income distribution. The uniform distribution of the characteristic will be represented in this case by a diagonal, called the “uniform distribution line,” and the uneven distribution, by the “Lorentz line,” the deviation of which from the diagonal characterizes the degree of unevenness.

Thus, if we take the amount of income and the population size as 100%, then direct OA will show an absolutely uniform distribution of total income between all population groups. However, the real distribution will always be characterized by a deviation from this straight line. An absolutely uneven distribution would coincide with the coordinate axes. But since the “super-poor” and “super-rich” always make up an insignificant part of a market society, we will have a certain curve (“Lorenz curve”), the deviation of which from the diagonal will clearly show the degree of uneven distribution of income.

To calculate a specific level of inequality in income distribution proceed as follows. The area formed by the lines of uniform and uneven distribution of income (it is shaded on the graph) is referred to as the area of ​​the triangle OAB. The resulting result is the “Gini coefficient,” which allows us to quantify the degree of income inequality in a country. It is determined by the ratio of the area of ​​the shaded figure to the triangle OAB.

It is clear that with a coefficient close to zero, society is in a state of absolute “equalization,” and with a coefficient equal to one, it is in a situation of “a poor majority and a super-rich minority.” A civilized market economy eliminates such extremes due to the targeted redistribution of income.

The economic history of mankind shows that both absolute equality in the distribution of income and too much bending of the body of the Lorenz curve are undesirable.

Absolute equality in income kills incentives for people to work productively. We are all born different and endowed with different abilities, sometimes quite rare. Therefore, in the national labor market, the demand for rare abilities far exceeds the supply. And this leads to an increase in the price of the labor abilities of such people, that is, their income.

However, people with the same type of abilities perform the same duties in different ways: with different labor productivity and product quality. It depends on their individuality, physical characteristics and neuropsychic makeup. How should these various results of labor be paid for and what is more important - the fact of labor itself or its result?

If you pay the same - “based on the fact of work”, then this will not suit people who work with greater productivity and are endowed with talents useful to society. Many of them will cease to work at full capacity, and their productivity will drop to the level of the least gifted and least hardworking members of society. As a result, the country's opportunities for economic progress will decrease, and the rate of growth in the well-being of all its citizens will slow down.

That is why people have to be paid for their activities in different ways, in strict accordance with the productivity and quality of work.

Because of this, a certain income inequality should be considered normal. Moreover, it is an extremely important tool for encouraging people to work.

On this occasion, the outstanding English economist of the twentieth century. Lord John Keynes observed: “Until science wins its inevitable victory, the choice must be between an equal distribution of misery and an unequal distribution of wealth.”

Economic history contains many examples proving that as a country’s economy develops and the general level of well-being of its citizens grows, the degree of income inequality initially increases and only then begins to slowly decline.

Thus, income inequality is the price that society has to pay for accelerating the growth of the overall level of well-being of all citizens of the country. But the need for such a “payment” never makes people happy. Against. The greater the differences in living standards between rich and poor, the greater the discontent of the latter. Economists have long established that differences in income become dangerous for social peace in a country if they:

becomes excessively large;

is growing too fast.

Economic statistics have found that the distribution of income, above a certain level, is characterized by considerable stability. This relationship between the amount of income (starting from a certain level) and the number of people receiving it received the name “Pareto’s law” in economic theory (named after the Italian economist who discovered it). Pareto's law means that if the distribution of low incomes is subject to sharp and sometimes unpredictable fluctuations, then when it reaches a higher level it becomes stable. The law confirms that social stability is a consequence of a high level of well-being of the population.

Conclusion

Income is considered not only as the final point of action for each participant in a market economy, but also as a source of satisfying social needs, the basis for expanded reproduction and social protection of the disabled and poor.

The functional distribution of income occurs among the owners of factors of production. However, in real life, many of the factor incomes are intertwined (for example, the participation of employees in the profits of the enterprise) and redistributed (as is the case with social transfers).

The main components of cash income of the population are wages, income from business activities and property, as well as social transfers (pensions, scholarships, etc.).

The state policy of income is to redistribute it through the state budget through differentiated taxation of different groups of recipients of income and social benefits. At the same time, a significant share of national income is transferred from high-income strata of the population to low-income strata. Nowadays, all developed countries of the world have created systems of social support for the poor.

The state directly intervenes in the primary distribution of monetary income and often sets an upper limit on the increase in nominal wages. The economic importance of state regulation of wages is determined by the fact that its change affects aggregate demand and production costs. Income policy is used by the state to restrain wage growth in order to reduce production costs, increase the competitiveness of national products, encourage investment, and curb inflation.

The most effective means of state regulation of wages is the establishment of a guaranteed minimum.

Social policy is a system of government measures aimed at mitigating inequality in income distribution and resolving contradictions between participants in a market economy.

Poverty is an economic condition of a part of society in which certain segments of the population do not have the minimum means of subsistence according to the standards of a given society. There are absolute and relative poverty, deep and shallow (measured by the income deficit of the poor in relation to the subsistence level).

Based on the research carried out in the work, it was found that:

In a market economy, the distribution of income is based on the fact that each owner of the factors of production receives his income depending on the supply and demand that exist in the market for the resource offered;

The state is directly involved in the distribution of income generated by the market;

In a market economy, there is an uneven distribution of income;

The distribution of income in a free market is adjusted by society.

Today in our country the distribution of income in a market economy is extremely uneven. At the current stage of economic development in Russia, there is a deep gap between the poor and the rich. In order to bridge this gap, it is necessary for the country to continue its economic development.

Bibliography

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.Bragin L.A. Revenues and profits. M.: INFRA-M. 2010 - 526 p.

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Income of the population- This is the sum of money and material goods received in social production, produced by a household or some other activity over a certain period of time.

The income of the population includes wages, business income, dividends on shares owned by the population, interest on savings invested in a bank, rent on rented real estate, etc. The sources of income of enterprises or firms are profit, interest or rent (depending on the type enterprises). However, not all profits are included in enterprise income. External deductions are made from gross profit. Part of the profit received by the entrepreneur becomes his personal business income. The remaining part of the profit is the actual income of the enterprise itself, which is used to expand production, personnel training, the social sphere, etc.

Income of the population is divided into monetary, natural, nominal, disposable, real.

Cash income of the population include all receipts of money in the form of wages, income from business activities, pensions, scholarships, various benefits, income from property in the form of interest, dividends, rent, income from the sale of goods, income from the provision of various services, etc.

Income in kind include products produced by households for their own consumption, as well as those obtained in public production.

Nominal income- the total amount of money received over a certain period of time; characterize the level of cash income regardless of taxation and price changes

Disposable income represents only that part of nominal income that can be used directly for personal consumption of goods and services, as well as for savings, i.e. disposable income is equal to nominal income minus contributions, taxes, mandatory payments (contributions to the Pension Fund, for social needs, etc.).

Real income reflects the purchasing power of our money income, represents the amount of goods and services (in value terms) that can be purchased with disposable income over a certain period of time (i.e., it takes into account the possibility of price changes).

The following are distinguished: basic principles of distribution income.

1. Equal distribution occurs when all members of society receive equal income. This principle is characteristic of primitive society and the communist mode of production.

2. Market distribution income assumes that each of the owners of one or another factor of production (land, labor, capital) receives a different income in accordance with the economic utility and productivity of their factor.

3. Distribution by accumulated property manifests itself in the receipt of additional income by those who accumulate and inherit any property (land, enterprises, houses, securities and other property).

4. Privileged distribution This is especially true for countries with undeveloped democracies and passive civil societies. The rulers of such countries arbitrarily redistribute public goods in their favor, set themselves increased salaries and pensions, creating good living conditions, work, treatment, recreation, and other benefits.

Whatever distribution system is fair, in any modern society it is inevitable people's income inequality, the reasons for which :

1) differences in individual abilities; 2) differences in qualifications and experience; 3) differences in willingness and ability to work in special conditions; 4) differences in ownership.

Differentiation of income of the population is actually existing differences in the level of income of the population, which largely predetermine social differentiation in society and the nature of its social structure.

To quantify the differential. income using various indicators. The degree of income inequality reflects Lorenz curve. The Lorenz curve shows the ratio of the percentage of all income and the percentage of all recipients. The degree of income inequality is determined by the area between the line indicating ideal equality and the Lorenz curve. The uneven distribution is characterized by the Lorenz curve, i.e. the line of actual distribution, the further away from the straight line the greater the income differentiation. Gini coefficient- a statistical indicator indicating the degree of stratification of the society of a given country or region in relation to any characteristic being studied. It is calculated as the area of ​​the region between the Lorenz curve and the ideal straight line of uniform distribution. The maximum possible area is taken as the unit of measurement. The Gini coefficient G can take values ​​from zero to one (0÷1). G = 0 means uniform distribution, G = 1 - the limiting case when only one person has the trait.

ALL-RUSSIAN CORRESPONDENCE FINANCIAL AND ECONOMIC COURSE

INSTITUTE

DEPARTMENT OF ECONOMIC THEORY

COURSE WORK

in the discipline "Economic Theory"

on the topic: “Income distribution in a market economy”

Executor:

Specialty Finance and Credit

Grade book no.

Moscow 2010

Introduction………………………………………………………………………………………...3

1.1 Income distribution in a market economy…………………………….4

1.1 Population income: concept, structure and indicators………………………..4

1.2 Principles of income distribution in society......................................................5

1.3 Distribution fairness in a market economy. Concepts of justice………………………………………………………………………………6

2. Income distribution and the problem of fairness in the economy

Russia……………………………………………………………………………………….12

2.1 Population income ratio 2005 by 2006………………………….12

Conclusion………………………………………………………………………………….15

Answers to KTZ………………………………………………………………………………...17

List of references………………………………………………………...18

Introduction

Assessing indicators of the dynamics and structure of income of the population is the most important element in the development of comprehensive forecasts. Income and purchasing power of the population are not only of social significance - as components of the standard of living, but also as factors determining the duration of life itself. They are very significant as an element of economic recovery, which determines the capacity of the domestic market. A capacious domestic market, secured by effective demand, is a powerful incentive to support domestic producers.

Low income levels, and, as a consequence, low purchasing power of the bulk of the population, are one of the main reasons for the stagnation of the Russian economy.

It is obvious that in order to revive the economy, it is necessary to create effective demand through an increase in the share of household income in the total income of society - GDP. Basically, to revive the domestic market and support domestic producers, it is strategically important to increase the incomes of the poorest and middle part of the population. An increase and, of course, timely payment of wages, pensions, scholarships and other social benefits is necessary for economic recovery. This is precisely what justifies the relevance of considering this topic.

1. Income distribution in a market economy

1.1 Population income: concept, structure and indicators

The level of people's well-being is characterized, first of all, by the income they receive. It is income that determines our opportunities for food and clothing, education and medical services; opportunities to visit theaters and purchase books, actively travel around the world, etc. The concept of income is broader than the concept of wages, since income can also contain other cash receipts.

Income of the population is the material resources available to the population to meet their needs. Income is considered at different levels using three main indicators. (Annex 1):

Nominal income is the total amount of money received by (or credited to) individuals during a given period. The structure of this income includes such elements as factor income, that is, those obtained from the use of one’s own factors of production - wages, rent, interest, profit; payments and benefits through government social programs (transfers); plus other income - interest on bank deposits, dividends on shares, insurance amounts, lottery winnings, etc. (Appendix 2).

Unlike nominal, disposable income represents only that part of the nominal that can be used directly for personal consumption of goods and services, as well as for savings. In other words, disposable income is equal to nominal income minus taxes and other mandatory payments (contributions to the pension fund, social needs, etc.).

Real income reflects the purchasing power of our monetary income. It represents the quantity of goods and services (in value terms) that can be purchased with disposable income over a given period (that is, it takes into account possible price changes). In other words, this is an individual “consumption basket” available to each person (according to the income he has).

The main sources of income for the majority of the population are wages and transfer payments. The relationship between them significantly influences the economic behavior of people. In particular, when earnings predominate in the income structure, this stimulates a person’s labor activity, his diligence, initiative, and entrepreneurship. When the role of transfers increases, people become more passive in relation to production activities and become infected with the psychology of dependency. Therefore, the directions and amounts of state social assistance must be thoughtful, balanced and strictly targeted.

1.2 Principles of income distribution in society

Different countries and different periods have different systems for generating household income. Most often, the following four basic principles of distribution are distinguished (Appendix 3):

Equalization distribution. It occurs when all members of society (or a certain part of it) receive equal income or benefits. This principle is typical for primitive societies, as well as for countries with a regime that Marx and Engels defined as “barracks communism.” In the literature you can find another, book name for this principle – egalitarian distribution. Since people differ in their abilities and energy, equalization of the remuneration of their labor inevitably gives rise to a situation where “one plants a vineyard, and another eats its fruits.”

Market distribution assumes that each of the owners of one or another factor of production (labor, entrepreneurial abilities, land, capital) receives a different income - in accordance with the economic utility and productivity of their factor. Thus, in relation to the owners of labor power (that is, hired workers), the well-known principle of distribution according to labor applies. It means that the amount of income of each worker depends on a specific market assessment of the significance of this type of work, as well as on its final results (how much, what, how and what quality is produced).

Distribution by accumulated property. It manifests itself in the receipt of additional income by those who accumulate and inherit any property (land, enterprises, houses, securities and other property).

Privileged distribution This is especially true for countries with undeveloped democracies and civilly passive societies. There, rulers arbitrarily redistribute public goods in their favor, arranging for themselves increased salaries and pensions, improved living conditions, work, treatment, recreation and other benefits. Montaigne is right: “it is not need, but rather abundance that gives rise to greed in us.”

1.3 Distribution fairness in a market economy. Justice concepts

Market distribution of income based on the competitive mechanism of supply and demand for factors of production leads to the fact that the remuneration of each factor occurs in accordance with its marginal product. Naturally, this mechanism does not guarantee equality in the distribution of income, and in reality, in countries with developed market economies, there is significant inequality in their distribution.

Within the framework of positive economic theory, there is simply no answer to the question of what kind of income distribution is fair.

It is customary to distinguish between functional and personal distribution of income. Functional distribution means the distribution of national income between the owners of various factors of production (labor, capital, land, entrepreneurship). In this case, we are interested in what share of the “national pie” falls on wages, interest, rental income, and profit. Personal distribution is the distribution of national income among the citizens of a country, regardless of what factors of production they own. In this case, it is analyzed what share of national income (in monetary terms) is received by, for example, the poorest 10% and the richest 10% of families.

So, since Pareto efficiency does not give us any criterion for ranking points lying on the consumer opportunity curve (the achievable utility curve), we cannot say that the distribution at point A is fairer than at point B (Fig. 1).

The figure shows the achievable utility curve in society. We can state that if there is a movement from point K to point M, then a Pareto improvement is observed. There was an increase in the utility of both y and x. But moving from A to B or vice versa, i.e. sliding along the achievable utility curve, cannot tell us anything about the more preferable (from the point of view of justice) position of each of the indicated points.

There are the most famous concepts of justice, or fair distribution of income: egalitarian, utilitarian, Rawlsian and market.

Egalitarian concept considers equal distribution of income fair. The logic of reasoning here is as follows: if it is necessary to divide a certain amount of goods between people who equally deserve it, then an equal distribution would be fair. The problem is what do we mean by “equal merit”? Equal labor contribution to social welfare? Same starting conditions in terms of property ownership? Same mental and physical abilities? Obviously, we will not get a single answer to this question, because we again turn to moral judgments. But here it seems important to emphasize that the egalitarian approach is not as primitive as it is sometimes presented in journalistic articles by glib authors: take and divide everything equally, as suggested by the character of the famous story by Mikhail Bulgakov “Heart of a Dog” Sharikov. After all, we are talking specifically about the equal distribution of benefits among equally deserving people.

Utilitarian concept considers fair the distribution of income in which social welfare, represented by the sum of the individual utilities of all members of society, is maximized. Mathematically, this can be expressed in the form of a formula reflecting the utilitarian function of social welfare:

Where W- social welfare function, and And- individual utility function. In our conditional example, the formula will take the form:

Income and their distribution V market economyCoursework >> Economic theory

... income………………….... 16 2.1. Main types income ................................................................. 18 2.2. Distribution income: inequality and poverty........................ 21 Chapter 3. Distribution income V market economy ...