THE IMPACT OF SOCIAL TRANSFERS IN REDUCING INCOME INEQUALITY IN NORTH MACEDONIA
Keywords:
social transfers, income inequality, social assistance, North Macedonia, Gini IndexAbstract
Social transfers as part of the social protection programs of the countries permanently experience rise as part of the governments expenditures, even though differ in volume and structure. One the main reason behind the rise of social transfers or expenditures is that through them countries tackle the problem with income inequality, enable more equal income distribution and stiffle poverty. However, the aim of this paper is to examine and analyze the impact of social transfers in reducing income inequality in North Macedonia. Consequently, North Macedonia continuously has increased the public expenditures on social transfers, even though the main portion is reserved for pensions, in the last years it is noticed an increase in the other social transfers, such as the social assistance and the adoption of guaranteed minimum income scheme. On the other hand, North Macedonia is one of countries that have registered considerable high income inequality through the years, but there are positive results experienced in the last years in reduction of income inequality. The findings of our study confirmed the impact of the social transfers in reducing income inequality in North Macedonia and proof the inverse relationship. Respectively, the increase in social transfers contributes in reducing income inequality. Hereby, social transfers ought to be one of the policies that the country may enforce in the future for further reduction of income inequality and to ensure fairer redistribution of the income
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