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Index components EU measures OECD measures Income and wealth Jobs and wages Housing Health Work-life balance Community Ability to make ends meet Material deprivation (inability to afford certain items) — Education — Civic engagement Environment Safety Life satisfaction Satisfaction with public services Quality of society Table 3.4.2 Indicators and measures of the OECD Better Life Index (2011) and the EU Quality of Life Survey (2011) Housing tenure Quality of dwelling Neighbourhood quality (services, safety, state of the environment) Health satisfaction; Access to health care Balancing work and family life; Strain-based conflict Contact with family members and friends Satisfaction with family life and social life Various forms of political and civic participation (except for elections and engagement) Is included under housing Safety in the neighbourhood (as a housing indicator) Subjective well-being By field of service — Trust in people and public institutions Perceived social tensions Household net-adjusted disposable income Household financial wealth Employment rate Long-term unemployment rate Personal earnings Job security Rooms per person Dwelling with basic facilities (% of people with WC) Housing expenditure Life expectancy; Self-reported health Employees working very long hours (over 50 hours per week); Time devoted to leisure and personal care (incl. sleep) Quality of support system Years in education; Student skills (average performance of students aged 15) Voter turnout; Consultation on rule-making Air pollution Water quality Assault rate Homicide rate Self-reported life satisfaction greater importance on the social cohesion and differences between social groups (in addition to the differences between countries that are important to both). 3.4.2 Indices and measures of the quality of life Due to the multi-faceted nature of the concept of life quality, there have not been any reliable indicators for a long time. Due to the lack of a better indicator, GDP was often used for this purpose; an approach which today has been widely criticised (Diefenbacher, Zieschank, 2009; Toots and Bachmann, 2010). In the 1970s and 1980s, percentage of social costs of GDP has been used to rankthe welfare states. Today, the high percentage of welfare costs is no longer an adequate measure of the country’s social sustainability.Moreover, this indicator does not provide – information about how well-being is distributed among the individuals or social groups. Thus, the access to healthcare, in countries with similar level of social expenditures, may differ. In sum, the GDP did not measure the quality of life adequately, and, also, it did not cover all of the content that is included today in the meaning of quality of life (Stiglitz, Sen, Fitoussi, 2009). Thus, the OECD adopted a complex framework of measures, which is based on three pillars: material living conditions, quality of life and the sustainability of well-being in time. Since by today the Better Life Index has been compiled only once, the sustainability dimension cannot be computed yet and– the OECD’s Better Life Index (BLI) measures well-being in two interconnected dimensions, by using eleven inidcators(Table 3.4.1). It is also important that well-being is measured at the micro- (individual) and meso- (group) levels, because the macro level (general economic situation, GDP) and an individual standard of living may diverge. An important feature of the OECD quality of measurement is reliance on statistical indicators, and thorough attention to the quality (incl. comparability) of the statistics that are used. Some other indices (e.g. the Gallup World Poll, the European Quality of Life Survey) are based on opinion polls, about which the OECD has reservations (the comparison of countries may be nonreliable, the samples are too small). However, the OECD is also using some subjective data from the Gallup World Poll for measuring subjective well-being, until better data become available. This chapter relies primarily on the OECD Better Life Index, supplementing them, with data from the European Quality of Life Survey (EQLS). Many of the indicators of these two surveys of quality of life overlap, but there are also differences (Table 3.4.2.). For example, the OECD includes labour market indicators in the Better Life Index; the EU acknowledges the importance of employment in life satisfaction, but does not measure it in connection with the quality of life. As a whole, in the European Union’s approach, greater attention to the social side of life quality can be noticed (e.g. the state of one’s neighbourhood, social tensions between groups, social and civic engagement, networks, and perceived social alienation). Satisfaction with public services is a separate indicator of the EQLS, which can be explained by the European social model that valuesgovernment responsibility in securingcitizens welfare. Although the OECD countries also are welfare states, the concept of the state as the provider of welfare is significantly different in Asia and the U.S. than it is in Europe (Alber and Gilbert, 2010; Alcock and Craig, 2009). Therefore, it is not possible to make meaningful comparison of the level of public services in various regions of the world. 3.4.3 Quality of life – the general picture It is not adequate to place countries into one absolute ranking in the case of such a multifaceted object, like a high-quality, or good, life. A country can be at the top, in regard to certain indicators, and lag behind, in others. By reducing the various indicators to one composite score, we would get an “average” result, which would not provide a adequate picture of the social success. This is also the argument used by the EQLS to explain why 130 Estonian Human Development Report 2012/2013
a uniform composite indicator has not be created, and why the various dimensions of life quality are analysed separately (Eurofound 2012). It is better to make country clusters , with similar levels of life quality, , or to compare countries on the bases of specific indicators. Here, we use the final product of the OECD’s statistical calculations,- expressed in scale values between 0 and 10 points, where 10 is the highest and 0 the lowest level. Country groupings Of the 36 OECDcountries, the top countries (7.5–8.0 points) are Switzerland, Norway, Canada, the U.S., Sweden, Denmark, and the Netherlands. The next group (7.0–7.5 points) is primarily comprised of Western European states – Belgium, Finland, Great Britain, Iceland, Ireland, Austria, Germany, and New Zealand. The group of with a score slightly above average (6–7 points) is geographically and politically the most diverse – France, Spain, Italy, Slovenia, Japan, Poland and the Czech Republic. A common trait is the relatively short span of an open democratic society, which applies to all, except France. Estonia belongs to the next group, where the level of quality of life is below average (ca. 4.5), and which also includes Hungary, Brazil and Chile. At the same time, Russia, Mexico, and especially Turkey, lag considerably behind others. According to the European Quality of Life Survey (EQLS), the countries with the higher quality of life are located in Northern and Western Europe, while the level in the Eastern and Southern countries is lower. Although in some base indicators differences between countries are decreasing, in general theyare still large. The Central and Eastern European countries have not caught up with the old Member States, but rather, the quality of life has weakened in some old Member States, especially in the Mediterranean countries. Since the EQLSdoes not make generalised indicators, it is compliated to speak about clusters here. More broadly, it is not typical for the European Union to rank states, as the OECD does. 3.4.4 Country rankings in separate indicators Based on the individual indicators of the Better Life Index, Estonia’s position in the ranking is somewhat surprising. Estonia has similar rankings with countries that we usually do not consider as being similar to us (Table 3.4.3). Estonia is most similar to Poland, but also to Slovakia, Hungary, Italy and Spain. Moreover, the similarities are not limited just to the indicators of material well-being, but also to social capital and subjective well-being. Another unexpected finding is that the Scandinavian countries do not comprise a uniform group. A very high level of well-being and quality of life can be found in the various regions of the world – in the heart and on the edges of Europe, in North America, Australia and Asia. It is also worth noticing that one particular country has achieved the highest score in a maximum of two indicators out of ten. Dispersion, not convergence seems to be the current trend in global human development. Based on the European Quality of Life Survey, in many indicators of material well-being, Estonia is similar to Hungary and Latvia, but also to Poland, the Czech Table 3.4.3 The position of countries in the OECD Better Life Index (2011),according various inidcatora; the reference states are shown in bold 3.4.5 Strengths and weaknesses of Estonian quality of life Estonia’s low position in the overall ranking of the OECD Better Life Index (31 st position out of 36countries)rises the question, “Which indicators are the ones that significantly increase ourposition, and which decrease it?” This question is also important because, in the states with higher quality of life, the level of various indicators are relativelysimilar, which demonstrates a balanced development. Estonia however,demonstrates uneven levelof develop- Components Income and wealth Jobs and wages Housing Health Work-life balance Community Education Civic engagement Environment Safety Life satisfaction Measures Household net-adjusted disposable income Household financial wealth Employment rate Long-term unemployment rate Personal earnings Job security Rooms per person Dwelling with basic facilities (% of people with WC) Housing expenditure Life expectancy; Self-reported health Employees working very long hours (over 50 hours per week); Time devoted to leisure and personal care (incl. sleep) Quality of support system Years in education; Student skills (average performance of students aged 15) Voter turnout; Consultation on rule-making Air pollution Water quality Assault rate Homicide rate States similar to Estonia Slovakia, Poland, Hungary Slovakia, Spain Hungary, Chile, Poland Korea, Turkey Brazil, New Zealand, Canada, Great Britain Poland, Brazil, Italy, Czech Republic Korea, New Zealand, Poland, Sweden Israel, Russia Spain, Italy Russia, Israel, Belgium Republic and Lithuania. However, greater social involvement, institutional trust and optimism about the future make Estonia totally different from other Eastern European countries. Thus, the Estonian population’s perception of life quality continues to be transitional – the prevailing thinking is “things are tough today, but the future will be better”. This optimistic attitude is not typical to other post-communist states, which makes Estonia quite unique. State with the highest indicator USA Switzerland USA Switzerland Denmark Iceland Finland Australia Sweden Japan Self-reported life satisfaction Greece, Poland Denmark Estonian Human Development Report 2012/2013 131
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ESTONIAN HUMAN DEVELOPMENT REPORT 2
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Table of Contents 1 Human Capital /
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Dear Reader Since the moment when E
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1Human Capital Estonian Human Devel
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the HDI’s content has also been h
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Figure 1.1.1 The human development
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Figure 1.1.7 The income sub-index:
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The results of the Princeton Projec
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the hypothetical generation. The to
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Figure 1.2.3 Life expectancy. Eston
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Table 1.2.2 also presents the most
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The new trends that are appearing i
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Figure 1.2.8 Components of populati
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New features were introduced into E
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Initiation of Voluntary Birth Contr
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Table 1.3.1 Best-known educational
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(OECD 2012b). Therefore a certain r
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The reciprocal dependence of the pr
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Figure 1.3.8 Percentage of students
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Table 1.3.4 The quality of educatio
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1.4 Health Raul-Allan Kiivet Change
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Table 1.4.1 Usage of prescription m
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allude to the fact that approximate
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promote healthy lifestyles among th
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Figure 1.5.1 The World Values Surve
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Table 1.5.2 Estonia’s participati
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Figure 1.5.3 The percentage of the
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Figure 1.5.5 Percentage of the Esto
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The fact that Estonia’s position
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Summary Mati Heidmets The global vi
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2People and Society Estonian Human
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Table 2.1.1 Structure of the Bertel
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tioning market economies (15 states
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2.2 Freedom and democracy Martin M
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Table 2.2.1 Democracy indicators Po
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Figure 2.2.2 The distribution of th
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would be something that none of the
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political participation are general
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strongest, while a very small perce
Page 81 and 82: is concerned, Estonia is one of the
Page 83 and 84: Figure 2.4.2 Average circulation of
Page 85 and 86: 2.5 Corruption Jüri Saar In accord
Page 87 and 88: Lithuania, 61%; and in Russia, 69%.
Page 89 and 90: 2.6.2 Intentional homicides in Esto
Page 91 and 92: crime. And thirdly, there was a wis
Page 93 and 94: References 1. Ahven, A. & Tabur, L.
Page 95 and 96: states included in the EU Kids Onli
Page 97 and 98: 2.8 Public assessments of the state
Page 99 and 100: Figure 2.8.4 Changes releated to tr
Page 101 and 102: of the state’s development are en
Page 103 and 104: Table 2.9.1 The positions of Estoni
Page 105 and 106: 3. IEP (2011). Structures of Peace.
Page 107 and 108: 3Welfare and the Quality of Life Es
Page 109 and 110: choices made, not what people say t
Page 111 and 112: Figure 3.1.5 Public social spending
Page 113 and 114: tion agreed upon the social contrac
Page 115 and 116: References 1. Aidukaite, J. (2006).
Page 117 and 118: hand, to the “inequality of acces
Page 119 and 120: and explanations of the extent of i
Page 121 and 122: 5- much more than I deserve. Some d
Page 123 and 124: people in Estonia consider the inco
Page 125 and 126: Table 3.3.1 Experienced Well-Being
Page 127 and 128: at about 70%. In Latvia and Lithuan
Page 129 and 130: sign. It seems that the usual view
Page 131: 3.4 Quality of life Anu Toots 3.4.1
Page 135 and 136: 3.4.6 The components of life qualit
Page 137 and 138: Figure 3.4.4c Perceived quality of
Page 139 and 140: Figure 3.4.5 Changes in the depriva
Page 141 and 142: 3.5 Environment dimension of well-b
Page 143 and 144: Figure 3.5.1.b Estonia’s position
Page 145 and 146: 3.5.4 Energy intensity The energy i
Page 147 and 148: productivity, which is defined as t
Page 149 and 150: perceive themselves as worse off th
Page 151 and 152: 4The Economy Estonian Human Develop
Page 153 and 154: vide a valuable connection for maki
Page 155 and 156: Figure 4.1.3 Components of economic
Page 157 and 158: ule of law, the sub-indicators for
Page 159 and 160: References 1. Acemoglu, D.; Robinso
Page 161 and 162: Development Report employs generali
Page 163 and 164: and pasture land, and this was capi
Page 165 and 166: Basing the total and net savings re
Page 167 and 168: 4.3 Labour market Reelika Leetmaa,
Page 169 and 170: The problems include the very limit
Page 171 and 172: • Expenditures for active labour
Page 173 and 174: who lose their jobs. These ensure i
Page 175 and 176: 4.4 Productivity and the economic s
Page 177 and 178: labour costs at the company level r
Page 179 and 180: Table 4.4.4 Comparison of the produ
Page 181 and 182: Figure 4.4.1 Annual average increas
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4.5 Innovation Erik Terk, Katrin M
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Table 4.5.2 Comparison of innovatio
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Table 4.5.4 Comparison of the indic
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in order to make the R&D potential
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It is characteristic of the South K
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mechanisms for increasing their sta
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Globalisation and Policy Patterns 5
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When Estonia regained its independe
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5.2 The impacts of globalisation an
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Table 5.2.2 Support of the differen
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5.3 Development policies Erik Terk,
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• C -the “Estonia-centred” su
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Figure 5.4.1 Support for the possib
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Summary Erik Terk Estonia is part o
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ehavioural patterns. Therefore, it
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EDR 2012/2013 authors Clemens Buche
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EDR 2012/2013 authors Alari Purju i
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Editor-in-Chief: Mati Heidmets Prod
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