Understanding income differentiation: a socio-economic perspective on Moldova

Abstract

This study explores the multifaceted nature of income inequality in the Republic of Moldova, analyzing the structural and individual factors that influence the distribution of monetary and non-monetary income. The research highlights the growing concern over inequality as a driver of social instability and economic inefficiency. The primary objective is to identify and classify the determinants of income differentiation by grouping them into systemic and individual factors. These include economic, political, demographic, social, professional, and psychological influences. The methodology consists of an analytical review of theoretical frameworks and empirical data, structured according to established economic classifications. Key findings indicate that income inequality is shaped not only by productivity and property ownership, but also by institutional asymmetries, unequal access to education, and unequal bargaining power in labour markets. Furthermore, factors such as urban-rural residence, family structure, and informal economies exacerbate disparities. The study concludes that while certain drivers of inequality may be inherent to market dynamics, many are institutional and policydriven. Effective mitigation therefore requires targeted policy reforms, improved redistributive mechanisms and support for equal opportunities. This comprehensive approach is essential to ensuring inclusive development and social cohesion in Moldova. The article was developed within the framework of Subprogram 030101 „Strengthening the resilience, competitiveness, and sustainability of the economy of the Republic of Moldova in the context of the accession process to the European Union”, institutional funding.