Losers in market transition: the unemployed, the retired, and the disabled

The market transition debate is almost primarily focused on the ‘winners’ and on what happens to the formerly privileged during the market transformation process in post-Communist societies. This study emphasizes the impact of the market transformation process on the income of those who have few resources and are eligible for social benefits. Are these people the ‘real’ losers of the market transformation process in post-Communist societies? OLS regression models are estimated based on 50 standardized cross-sectional surveys on the Czech Republic, Hungary, Poland, Russia, and Slovakia covering a period from 1991 to 2002. The analyses show that the unemployed have the lowest income and that the income of retirement and disability pensioners is relatively protected, especially during the early transformation years. Education seems to be a helpful resource for the unemployed and pensioners, but not specifically during the turbulent early transformation years. Results on the income effect of urban residence are inconclusive.