Estonian Human Development Report

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Figure 1.4.3. Estonian GDP (right axis) and GDP growth (left axis) per capita in PPS 2000–2007 (EU 27 = 100) 10 9 8 7 6 5 4 3 2 1 0 2000 2001 2002 2003 2004 2005 2006 2007 Source: Eurostat GDP per capita in Purchasing Power Standards Growth of GDP per capita in Purchasing Power Standards 80 70 60 50 40 30 20 10 0 The Purchasing Power Parities, like the majority of statistical indicators, include assessment and therefore also statistical errors. Therefore when comparing countries, one must keep in mind that the difference in GDP values calculated on the basis of PPP that are under 5% are statistically insignificant [Methodological…, 2006]. The PPP errors depend on the reliability of the weight of the cost groups and the prices related thereto, and on how precisely the goods and services used in the measurement reflect the consumer model of an individual country and its price level. Standard of living of Estonian families in 2003–2007 Considering the fact that in 2003–2007 Estonia experienced rapid GDP growth, reaching 68% of the European Union average, it is quite natural to ask whether Estonian families perceived the economic growth that took place in 2003– 2007 through an improvement in their standard of living. In other words, how much are increases in general economic indicators related to increases in the standard of living? Figure 1.4.4. Structure of Estonian families’ consumption 2003–2007 6000 5000 4000 3000 2000 1000 0 2003 2004 2005 2006 2007 Source: SE Personal costs Travel packages Books Leisure time Communications Transport Education Health care Domestic products Dwelling Wardrobe Restaurant Alc+ tobacco Food Incomes Tracking the dynamics of the economic condition of families [Tiit, 2008], it turns out that in those years incomes grew in all types of households. During the four year period, the nominal income per household member in Estonia increased by 94% on average and the real income by 63%. The greatest increase was in double-income families with several children (2.35 times), as well as in single-income (two-parent) families with two children (2.28 times) and one child (2.06 times). This is probably caused by the impact of family policies because parental benefits had the greatest impact on such families. Relatively smaller income increases (71%) were experienced by single-parent families and the impact of parental benefits was not great (presumably children are not often born into single-parent families, although single-parent families develop upon the departure of one parent). The impact of parental benefits (as a portion of income) has continually increased. Child benefits comprise an important part (at least 15%) of the income of families with at least two children and one working parent. Pensions increased during the reference period by slightly less than the average, by 77%; whereas the real pension growth was only 49%. Expenditures Increases in income have a positive impact on the quality of life, if they provide people with greater opportunities to satisfy more diverse needs. In 2003–2007, the non-food expenditures (in nominal value) of Estonian families increased by 61% on average. Considering the increase in the consumer price index, one can conclude that the real expenditures increased by 40% during the same period. In the structure of non-food costs, the differences in the expenditure levels of different household groups are almost two times greater than in the case of food products (2.7–3.3 times). Transport costs experienced a relatively large increase – to a great extent this was caused by the rise in transport and fuel prices, as | 28
well as the increase in the number of cars and the tradein of old cars for new ones. Wardrobe and leisure costs also increased considerably, as did expenditures for personal items and personal services. The greatest increase was in travel packages. The increase in food products and housing was lower than average. Household differences in the cost structure and volume continued to be large, although there was no clear trend towards the differences increasing or decreasing. All financial costs (taxes, fees, investments, loan repayments and interest, insurance, social taxes) combined comprise less than quarter of all expenditures on average. It is important to know how families’ budgets will be affected by the existence of loans. The average volume of loan repayments (nominal value) increased by 78% in the years being examined. Food expenditures At their nominal value, food expenditures increased by 49% on average, which means a real cost increase of 23% (considering the 21% inflation of food prices). Still the structure of food expenditures has not changed significantly in this period. What did occur was a small shift to higher quality and more expensive foodstuffs. Meat and meat products comprise an average of one-fifth of all food expenditures; 13.5% is spent on milk, milk products and eggs, although during the year under observation, the consumption of cheese increased; 12.4% is spent on bread and other grain products. Similar amounts were spent on fruits, vegetables and potatoes (6.5%) and alcohol (6.4%, although this is probably underestimated). The amounts spent on fruits and berries increased significantly (by 85% in nominal value). Even larger was the 2.25-fold increase in the consumption of juice (nominal value). Of the total food budget, 5.7% was spent on both non-alcoholic beverages and sweets. The food consumption structure is very similar by type of household (Figure 1.4.5.), while the same does not apply to single households. Greater differences between types of household exist in the volume of eating Figure 1.4.5. Volume and structure of food costs in cost quintiles 5 , average for 2003–2007 2200 1700 1200 700 200 0 2003 2004 2005 2006 2007 Source: SE Restaurant Tobacco Alcohol Beverages Sweets Vegetables/ potatoes Fruits Butter/oil Milk/eggs Fish Meat Bread, cereals out (10%, 2.4%–12.5% by type of household). Therefore, one can confirm that in 2003–2007, the living standard of Estonian households improved, especially in the area of nutrition in a financial sense. In Estonian history, there has probably never been another period when the economic standard of living improved so quickly. References 1. Märten Ross. Eesti Panga majandusprognoosist ja rahapoliitilisest olukorrast. Presentation to the Riigikogu Finance Committee 04.12.2008 2. European System of Accounts, ESA 1995. Luxembourg, 1996. 3. Global Purchasing Power Parities and Real Expenditures. 2005 International Comparison Program. 2008 by the International Bank for Reconstruction and Development/The World Bank 5. System of National Accounts 1993, Commission of the EC, IMF, OECD, UN and World Bank, 1993. 6. Ene-Margit Tiit. Perede sissetulekute ja tarbimise struktuur 2003–2007. Contract report. Office of the Minister of Population Affairs, 2008 7. Human Development Reports, http://hdr.undp.org/en/ humandev/ 4. Methodological Manual on Purchasing Power Parities. European Communities/OECD, 2006 5 Cost quintiles are calculated by dividing the sequential range of households into five equal parts. Those with the lowest income comprise the first fifth or quintile, the highest ones – the fifth quintile. 29 |
Page 1 and 2: Estonian Human Development Report
Page 3 and 4: Estonian Human Development Report T
Page 5: 4.2. Ethnic differentiations in sat
Page 9: Preface This year, the Estonian Hum
Page 12 and 13: CHAPTER 1 Estonian Human Developmen
Page 14 and 15: Figure 1.1.3. Life expectancy in co
Page 16 and 17: Figure 1.2.2. Life expectancy at bi
Page 18 and 19: to reality. The greatest inaccuracy
Page 20 and 21: Figure 1.2.9. Internal migration ev
Page 22 and 23: 12. Marksoo, A. 1992. “Dynamics o
Page 24 and 25: Table 1.3.1. PISA 2006 study result
Page 26 and 27: Table 1.3.2. Number of students in
Page 28 and 29: 1.4. The gross domestic product and
Page 32 and 33: 1.5. Changes in the Estonian Human
Page 34 and 35: 2.2. Health of Estonian residents i
Page 36 and 37: Table 2.2.4. Differences in life ex
Page 38 and 39: Figure 2.4.1. Healthy life years of
Page 40 and 41: Figure 2.4.4. Various accidents, tr
Page 42 and 43: 2.5. Lifestyle and behaviour as a s
Page 44 and 45: Figure 2.5.5. Smoking in Estonia in
Page 46 and 47: Figure 2.6.1. Overview of the compo
Page 48 and 49: Table 2.6.2. Use of specialized med
Page 50 and 51: dren. The majority of services are
Page 52 and 53: Figure 2.8.2. How much a health dis
Page 54 and 55: 2.10. Policy recommendations aimed
Page 56 and 57: CHAPTER 3 Quality of life and life
Page 58 and 59: Table 3.2.1. Characteristics of liv
Page 60 and 61: Table 3.2.4. An assessment of the e
Page 62 and 63: Figure 3.2.4. Difference in the job
Page 64 and 65: Table 3.2.6. Agreement with stateme
Page 66 and 67: Figure 3.3.1. Satisfaction with lif
Page 68 and 69: Figure 3.3.4. Percentage of people
Page 70 and 71: Figure 3.4.1. Types of quality of l
Page 72 and 73: Figure 3.5.1. Percentage of teenage
Page 74 and 75: Figure 3.5.4. Percentage of respond
Page 76 and 77: Arieh A., Conti C., Kutsar D., Nicg
Page 78 and 79: Figure 3.6.2. Subjective quality of
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Pieper, A. Sixsmith, Care related q
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Figure 3.7.1. The placement of Euro
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Figure 4.2.1. Life satisfaction by
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Table 4.2.1. Factors forming genera
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Annexes Annex 4.2.1. Socio-demograp
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Figure 4.3.1. Changes in the assess
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Figure 4.3.4. Attitudes of the Esto
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olds considered themselves to be pa
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Table 4.4.3. Agreement of the Russi
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Table 4.5.2. The prospects of non-E
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Figure 4.5.4. Certainty of Estonian
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mote equal opportunities. At the (e
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CHAPTER 5 Quality of life in a cons
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Figure 5.2.1. GDP and AIC per capit
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Figure 5.2.3. Distribution of consu
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Figure 5.2.4. Indexes of environmen
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Table 5.3.1. Comparison of countrie
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Figure 5.3.3. Comparison of types o
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Table 5.3.5. Connections between po
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Table 5.4.1. Who and what are the f
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Table 5.4.3. Young people’s asses
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Figure 5.4.6. Time spent on the con
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Table 5.4.6. The perception of prob
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5.6. Summary To briefly summarize t
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Table 6.2.1. Objective and subjecti
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Figure 6.2.4. Relationship between
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Figure 6.2.7. Difference between th
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Figure 6.3.1. GDP, government secto
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Figure 6.3.3. Employed 15-74-year-o
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Figure 6.3.8. Percentage of social
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References 1. Aaviksoo, A., G. Paat
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Figure 6.4.1. Labour market flexibi
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Figure 6.4.3. Creations of jobs ind
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Figure 6.4.5. Public expenditures o
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Figure 6.4.6. Ratio of the particip
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6.5. Cities as development engines
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Table 6.5.2. Existence of developme
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have been underfinanced or are not
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Table 7.1. Factors that favour and
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Table 7.2. Potential economic devel
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Authors Chapter 1 Ene-Margit Tiit,
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Margit Keller (PhD) is a Senior Res
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Special prizes Estonian Human Devel
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Estonian Human Development Report H
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Estonian Human Development Report H
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Estonian Human Development Report T
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Honorable mentions Estonian Human D
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Estonian Human Development Report P
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Estonian Human Development Report A
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Estonian Human Development Report T
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Estonian Human Development Report

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