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differentials (Vecernik, 1994). Under the communist economies, wage income was strongly correlated with age and household size (because of policies related to equal wages per worker and very high labor force participation rates) and only weakly related to education. But with the breakdown of the command economy, a much higher premium has been placed on secondary and university education and on the ownership of capital.

Between 1989 and 1993, food and housing costs rose slightly as a share of total expenditures in Central Europe. In Poland, however, other real consumption increases suggest that the substantial import liberalization had the desired effect of lowering the dollar costs of consumer durables. Since 1989, consumption of consumer durable goods has increased in every country, and in some instances these changes have been far from trivial (Gorecki et al., 1995). In Poland, the percentage of households owning cars has increased by one-third or more. While many of the cars are second-hand, they still represent a substantial purchase. The number of Polish worker households with video cassette recorders has also increased substantially, from almost nil in 1989 to over 50 percent of households with nonfarm workers by 1992. Similar increases can be noted among Polish mixed (farmer-worker) households, and to a lesser extent among farmer households. Much of the same pattern emerges in Slovakia, with most of the changes occurring between 1991 and 1994 (Bednarik et al., 1995).

Although smaller consumption increases were seen in the Czech Republic and Hungary between 1989 and 1991, the consumption of nearly all consumer durables increased there as well (Vecernik et al., 1995; Sik et al., 1995). Central European consumers also increased their purchases of other luxury durables, such as color rather than black-and-white televisions, during the transition.

In Hungary, the number of consumer durables purchased by households without members in the labor force (a group dominated by pensioners) actually increased over the period. With the increases in their real benefit levels, Polish and Slovak pensioners were also able to increase substantially their consumption of cars, washing machines, and freezers. Czech consumption data, when disaggregated by income, show that while those in the lowest-income population groups consumed less than the average in the country (especially families with children), pensioner households tended to increase their consumption of non-necessities, such as leisure goods (Garner, 1995). Thus, even the most vulnerable populations have found the means to take advantage of the increased availability of consumer goods since the transition began.


The above analyses suggest that as the national economies of the Czech Republic, Hungary, and Poland declined, the poverty rate and income inequal-

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