Slovakia - Poverty and wealth

In 1998, GDP per capita was US$3,822 in Slovakia, as compared to $5,142 in the Czech Republic, US$2,900 in Poland, and US$23,200 in the United States. Four decades of communist rule in Czechoslovakia (1948 to 1989) had a strong and enduring effect on the distribution of incomes in Slovakia. Under communism, wages were artificially kept at similar levels, so professionals such as doctors earned wages similar to those of factory or construction workers. Because property had belonged to the state and housing was distributed through state channels, those individuals who obtained large homes often did so through political means, such as good standing with the Communist Party.

By 2000, with the privatization of property, home ownership is increasingly becoming a privilege of financial success. However, the Slovakian government that administered the privatization process throughout most of the 1990s did so in a non-transparent (secretive) way, making it clear that political affiliation mattered for the acquisition of property at reduced rates. Such instances of corruption have allowed a few individuals to improve their economic standing through dubious means.

Although the social structure is rapidly moving toward a hierarchical class system, as of the late 1990s, income distribution and consumption in Slovakia remained more equalized than in the United States. In the United

Distribution of Income or Consumption by Percentage Share: Slovakia
Lowest 10% 5.1
Lowest 20% 11.9
Second 20% 15.8
Third 20% 18.8
Fourth 20% 22.2
Highest 20% 31.4
Highest 10% 18.2
Survey year: 1992
Note: This information refers to income shares by percentiles of the population and is ranked by per capita income.
SOURCE: 2000 World Development Indicators [CD-ROM].

States, the richest 20 percent of people earn and consume 46 percent of available wealth, as compared with Slovakia, where the richest 20 percent earn and consume only 31 percent of available wealth. In the United States, the poorest 20 percent earn and consume only 5 percent of available wealth, but in the Slovakia, the poorest 20 percent earn and consume nearly 12 percent.

Under the communist system, higher education and health care were freely provided by the state. Slovakia has been implementing reforms that require individuals to pay for these services. These reforms have been difficult for average individuals because institutions such as a comprehensive student loan system or health insurance have not yet been fully developed. The state does provide a social security system and some social assistance.

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