Study and analysis of factors affecting population income: the case of Uzbekistan

Introduction

Regardless of what kind of political and social actions each country implements, their ultimate goal is to increase the interests of the people, increase the living standards of the population, and increase their incomes. The growth of the population's income is the well-being of the population's standard of living. The increase in income has a positive effect on many aspects of human life, economic growth and development of the country. Thus, increasing the income of the population is one of the main issues that economists and politicians are thinking about. In fact, increasing people's incomes is one of the Sustainable Development Goals of the United Nations' 2030 agenda. [1.,12th July 2022]. Population growth has many effects on the economy. First, let's look at the definition of population growth: an increase in the number of people in a given area. Population growth can have a positive effect on the economy. For example, in the United States, an increase in the number of people leads to more access to the labor force, which leads to higher productivity, which leads to more output. As a result, the country's production (measured by GDP) increases! More people in a country leads to an increase in demand for goods. Demand and production of more goods drives economic growth. This is an example of how population growth has a positive effect on the economy [2]. Let's discuss population growth and economic development. Population growth can be a potential catalyst for economic development. Does a country with a population of 100,000 produce more than a country with a population of 100,000? Of course not! A country with a large population will be able to increase production more than a country with a smaller population. But the large population of the country does not automatically develop its economy. Per capita income is used to determine the average income of a person in an area and to assess the standard and quality of life of the population. Per capita income is calculated by dividing a country's national income by its population. One way some researchers divide people into economic classes is by looking at their income. According to this data, they divided the income earners into different classes: poor, lower middle class, middle class, upper middle class and rich. 9 examples of income: Earned income: Earned income is money earned by working for an employer. Business profit, tangible assets, intangible assets, capital gains, dividends, interest, rent seeker [3., May 2013]

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2 Literature Review

Over the years, increasing the income of the population and improving the standard of living has been one of the important socio-economic issues. During the past thirty years, research on national income has been an important factor in the analysis of income problems, and during the last century and the early 1900s, the study of these problems was primarily concerned with finance. directions of inquiry [4., 29.02.2012]. Six decades ago, Nicholas Kaldor (1957) put forward a set of stylised facts on growth and distribution for mature industrial economies. The first and most prominent of these was the constancy of the share of capital relative to that of wealth in national income. At about the same time, Simon Kuznets (1955) put forward a second set of stylised facts -- that while the interpersonal inequality of income distribution might increase in the early stages of development, it declines as industrialised economies mature [5.,March, 1955]. The theory of income and employment is a set of economic analyzes related to the relative levels of production, employment, and prices in an economy. By identifying the interrelationship of these macroeconomic factors, governments attempt to create policies that contribute to economic stability. John Maynard Keynes proposed a new way of thinking about the theory of income and employment with The General Theory of Employment, Interest, and Money (1936) [6.,Feburary 1936]. Marget's Classics (1966 [1938-42]) is still the most comprehensive account of the origins of the theory of monetary income. [7., 1966 [1938-42]]. As we study income and employment in the world system, we may not have specific goals in mind. In our opinion, the goals that should be supported by the theory of world income - in addition to the acquisition of real knowledge - are the following: global full employment, improvement of global income distribution, global social security, global economic growth (of a sustainable kind), environmental stability, democratic process [8., January 1999 ]. In both real economies and the theory of incomes, money market trade continues regardless of whether real prices are in equilibrium or not. general equilibrium theory clearly forbids this from happening. It was already Walras (1977 [1871], pp. 40–1), who argued that no transaction can pass. general equilibrium model at non-equilibrium prices [9., 2014, pp. 373–391, DOI: 10.1515/revecp-2015-0005]. The constant income hypothesis was developed in 1957 by the Nobel Prize winning economist Milton Friedman. The hypothesis suggests that changes in consumer behavior are unpredictable because they are based on individual expectations [10., November 27, 2020]. "Effective organization of the economy," states the American economist D. Nore, is the key to economic growth. Its emergence in Western Europe is conditioned by the rise of the West [January 2021, 7(1):161].

3 Research Methodology

We found it appropriate to study and analyze the factors affecting the income of the population. We believe that empirical analysis of population income issues in our republic will have a good effect, making scientific, based proposals and involving them in the digital economy. The research was conducted in Uzbekistan. In the study, the views of international scientists on the income of the population were observed on a large scale, the factors affecting the income of the population were selected and their correlation was determined using correlation analysis. Economic and statistical analyzes were conducted. To test this hypothesis, we preferred to analyze using the SEM (Structural Equation Model) method. For our analysis, we used independent and associated indicators, shown in Table 1. Researches of foreign and local scientists selected on the basis of these indicators are highlighted in the literature review. Primary data for the years 2017-2022 of the Republic of Uzbekistan, obtained from the data of the State Statistics Committee, are presented in the appendix.

4 Results

While studying the factors affecting the income of the population in our research, it is appropriate to analyze the composition of the total income of the population first of all. Table 1 below provides an analysis of the composition of the total income of the population.

Figure 1. Composition of total income of the population

According to preliminary data, as of January-December 2022, the total income per capita is 17.8 million. soums, the nominal growth rate of total income per capita was 119.8%. Due to changes in consumer prices, the real growth rate of total income per capita was 107.5% compared to the same period last year.

When the state of real growth of total income per capita was studied in the cross-section of regions, the highest real growth rate of total income per capita was observed in Khorezm region (11.8%). At the same time, total per capita real income growth was lower than the average republican level. In addition, in Navoi region (- 0.9%) the trend of real growth rate of total income per capita was noted.

Figure 3. Real growth rate of gross income per capita

Based on the information of the State Statistics Committee of the Republic of Uzbekistan, information was collected on the following influencing factors (x1, x2, x3) and the resulting factor (Y):

Y – income of the population in the Republic of Uzbekistan;

x1 – number of labor resources;

x2-Number of jobs in the economy;

x3-Fixed capital investment per capita.

Table 1

Factors affecting the income of the population in the Republic of Uzbekistan

Based on the data in the table, we create a correlation matrix (Table 2), a correlation matrix is ​​a matrix that reflects pairwise correlation coefficients between factors.

Table 2

Correlation matrix

Based on the data in Table 2, if we analyze the correlation matrix, the pairwise correlation coefficients between the factors are as follows: factor X1, i.e. the number of labor resources, and X3 - per capita investments in fixed capital are closely connected, creating multicollinearity. Therefore, these influencing factors Taking into account the interaction of Y with the resulting factor, X3 factor should not be used as an influencing factor, otherwise errors will occur in the correlation equation, which is formed under the influence of these influencing factors that we have selected. The multiple correlation coefficient between the resulting and influencing factors is calculated by the following formula:

From this, we can know that there is a strong correlation between the resulting factor Y and the factors X1, X2 that we have selected. Also, how well the selected factors represent the influence of the resulting factor is determined by the coefficient of determination R2-. So, R2 is equal to 0.995, that is, 99.5 percent of the change in the resulting factor U occurs under the influence of factors X1, X2. To carry out the analysis, we construct a multifactor correlation equation, in which we assume that the relationship between y and x is linear ( ) and determine the parameters a0, a1 and a2, based on the data presented in Table 2.

Thus, the linear equation of the correlational link regression takes the following form:

Yx = -9143730.7+0.43x1+0.11x2

Here, the regression coefficients α1, α2, α3 and α4 determine the relationship between the outcome variable (Y) and the influencing factor variable (x). This answers the question of how many units the resultant sign increases when the factor sign increases by one unit.

a0= -9143730.7; a1= 0.43; a2= 0.11. According to our analysis a1= 0.43; a2= 0.11. Therefore, there is a correct relationship between population incomes, labor resources and economically employed population, and their increase by one unit under conditions of unchanged other factors leads to an increase of the resulting factor by 0.43 and 0.11 units, respectively, as a0= -9143730.7 and represents the average effect of other factors taken as constant in our analysis on the resulting sign, that is, in the conditions where the factor signs are x1, x2→0, the resulting sign will be equal to Y=-9143730.7 at the expense of other factors taken as constant.

5 Conclusion

In the analysis of the income of the population, the classification characteristics of the factors affecting it and the stages of its formation according to individual sources are of great importance. In the process of analysis, the main layers of income formation are the number of labor resources, the number of jobs in the economy, the number of capital investments per capita, and the number of labor resources takes a special place in the growth of the population's income. In general, labor resources are considered the most active and responsible subject of the economy, and their influence on the income of the population is very high. Low-income segments of the working population in the economy are more sensitive to changes in the prices of basic consumer goods. Given that the majority of the low-income population operates in the informal sector of the economy, the decline in economic activity primarily affects their income. Therefore, taking into account the results of the analysis of the factors affecting the income of the population, it is necessary to develop effective measures to increase the well-being of the population with a low income. In our opinion, since the dependence of labor resources on increasing the income of the population is high, in order to increase them (labor resources), we should expand the coverage of higher education students, allocate quota places for the poor in higher educational institutions at the expense of the state and other financial institutions, develop intellectual labor activities, and increase its efficiency. it is necessary to implement priority tasks such as creating effective conditions that allow to increase and increasing the level of financial literacy of the population.