UKRAINIAN MIDDLE CLASS IN THE NEW MILLENNIUM: TRENDS AND PROSPECTS

Abstract

Ukrainian society has undergone various transformations over the past twenty years. Adverse economic conditions and ineffi cient income distribution policies deterred the for mation of a large middle-income group, which should become the basis of the middle class. Developed countries, which in the last century reached the peak growth of the number and importance of the middle class, today indicate the process of “blurring” of this social group against the background of growing inequality. Against the background of global trends, Ukraine is facing a double blow — the income distribution, which is already shift ed towards low incomes, leaves no chance for positive changes in the social structure of society. Th e a im of the article is to establish trends in the formation of the middle-income group in Ukraine over a twenty-year period and assess the prospects for the formation of the middle class in the future, taking into account today’s Ukrainian realities and global trends. Th e novelty of the work is the analysis of a long series of dynamics to establish the trends of the middleincome group according to the classical approaches for international comparisons and according to the purely Ukrainian approach. In addition, micromodeling of incomes (expenditures) for 2020, taking into account the macroeconomic situation, allows us to assess the impact of the coronavirus crisis and quarantine measures on changes in the number of middle-income groups and the prospects of the middle class in Ukraine. Within the article classical methods of analysis of long series of data, in particular, the index method (basic and chain indices) are used for studying the dynamic changes in the formation of midd leincome groups. In order to assess the size of the middle-income group in 2020, the method of micromodeling is used: the 2020 microdata is modeled on the basis of the 2019 microdata (microfi le of the household living condition survey) and macro forecast data for the current year. Analysis of the dynamics of incomes, expenditures and various property character istics of the middle-income group over the past twenty years does not show positive trends. Quite the contrary, in Ukraine there is an impact of the global trend of “blurring” of the middle-income group as the basis of the middle class, with its specifi c features in consumer and investment behavior. Th e events of the last year also do not inspire optimism — by the end of the year the general decline in living standards and the growth of poverty is expected. In such conditions, the main burden of the crisis is expected to fall on the middle-income group. Th e article also considers the problem of the importance of forming the middle class for society and the feasibility of forming politics to this goal.

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