The Great Divide: Ruralisation of Poverty in Russia

Using data from the RLMS for the period 2000-2004 we investigate poverty trends in Russia. We find that urban poverty declines at twice the rate of rural poverty so that by 2004 poverty in Russia had become a largely rural phenomenon for the first time since transition began. This finding does not stem from changing population characteristics or shares, is not dependent on the use of a particular poverty line nor is it driven by the rapid expansions that have occurred in Moscow, St. Petersburg or other urban areas. Our findings flesh out those of Ravallion et al (2007) who, in contrast to other regions, "find signs" of a ruralisation of poverty in Eastern Europe and the Former Soviet Union. We attribute some of the differential to the labour market