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ISSN: 2247-6172 ISSN-L: 2247-6172 Review of Applied Socio- Economic Research (Volume 9, Issue 1/ 2015), Page ‫ ׀‬1 URL: http://www.reaser.eu e-mail: editors@reaser.eu

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ISSN: 2247-6172 ISSN-L: 2247-6172 Review of Applied Socio- Economic Research (Volume 9, Issue 1/ 2015), pp. 3 URL: http://www.reaser.eu e-mail: editors@reaser.eu

Table of Contents 1. Kufo, Andromahi and Kripa, Dorina - Albanian banking sector and the challenges of adopting Basel II……………………………………………………………………….……4 2. Botan, Valentina - Post-Soviet countries: the journey from resource-driven economies to knowledge based-economies. Focus on ICT sector……………..………………….…15 3. Chatterjee, Boishampayan - Did suburbanization cause residential segregation?

Evidence from U.S. metropolitan areas……………………………….……………...…..25 4. Ionescu, Dan Dumitru and Ionescu, Alina Mariuca - Predictors of work-life balance for women entrepreneurs in the North-East Region of Romania…………………………..37 5. Jalilov Ganijonovich, Jamshid - Improving impact of motivational methods for employees and consumers of light industry enterprises ……………….…………….…47 6. McCreary, John J., Edwards, Julianne M. and Marchant, Gregory J. - Inequality, socioeconomic status, economic indicators, and student achievement …………………...….58 7. Rezeanu, Catalina-Ionela - The social construction of Roma housing issue: determinants of Roma and Romanians perceptions ………………………………...………………….66 8. Tonis (Bucea-Manea), Rocsana - Social Media as a Web-based Marketing Tool for Romanian SMEs ………………………………..…………………………………………79 9. Sabeva, Monika - Strategic Environmental Assessment – necessity, principles and specificities……………………………….………………………………….……...………90 10. Stanescu, Simona Maria - Changes of marital status: a 1991-2012 comparative analysis in member states of the European Union……………………………….………………103

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Albanian banking sector and the challenges of adopting Basel II Andromahi Kufo 1

1

, Dorina Kripa 2++

University of New York, Tirana, Albania 2

University of Tirana, Albania

Abstract. The Albanian banking sector is already facing the challenge of adopting the Basel II international standards with the aim of applying all the necessary requirements on the calculation and reporting of the regulatory capital by the end of 2014. These developments require major preparation from the banks in order to understand, assimilate and implement the new requirements. This paper aims to analyze the challenges and opportunities of the Albanian banking sector in implementing these new requirements.

Initially we will define the theoretical context of the requirements of Basel I, II and III as well as the literature review of the basic challenges that Basel II created for developed and emerging countries. In continuance it will be presented a comparative analysis of the requirements of Basel II with the actual Albanian regulatory framework with a special focus on the compliance of the legislation and gaps identified.

We point out the fact that Albania as an emerging country is in the process of implementing a hybrid of Basel I and II, since the regulator considers it more suitable with the actual financial situation and the banking sector structure. With reference to the above the Albanian banking sector needs to identify the methods of value maximization from the implementation of this framework and to successfully manage the restrictions it has for implementing it up to the end of 2014.

Finally in the aim of identifying all the challenges and opportunities of this process, we’ll analyze the major factors that will affect the banking sector with a special mention to the requirements of the regulatory capital.

Keywords: Basel, regulatory capital, Albanian banking sector, regulator JEL Codes: G210, G280.

1.

1.1.

Introduction The historic steps towards an International Accord in 1988 (Basel I)

The main reasons of regulating banks have pushed over searching ways and manners to properly fulfill this need. Starting from the 1900 in the USA the first capital adequacy requirements ratio has gained recognition worldwide and is actually implemented from 100 countries all over the world. These requirements prevent banks’ losses, protect creditors in case of bank failure, and restrict risk taking strategies



Msc, PhD candidate, Department of Economics and Finance, Faculty of Economics, Rr. Medar Shtylla (ish Komuna e Parisit), Tirana, Albania, corresponding author, e-mail address: andromahikufo@uny.edu.al . ++ Assoc. Prof.

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of banks. Further capital adequacy rules in USA included Capital to Deposit Ratio (1900 - 1930s), Capital to Total Asset Ratio (1930s), and Capital to Risk Asset Ratio (1945 – 1970s).

Competitiveness has eventually pressed the fall of capital ratios that reached its lowest levels in the mid1980s and the Basel Committee on the Banking Supervision was obliged to act in the harmonization of the regulatory requirements for the international playing banks. The framework suggested that banks from different countries competing for the same loans would have to set the same (roughly) amount of capital. The result from the Committee’s effort was the Basel Capital Accord (or known later on as Basel I), which is still in force today.

The main characteristics of Basel I was: 1. To ensure that international banks would build business volume with appropriate capital backing 2. To set minimum capital standards on banks 3. To focus on credit risk The new concept of Basel I was the incorporation of credit risk in the calculation of capital requirements.

The minimum capital requirement was set to 8% of risk- adjusted assets, with half of this to be met by Tier 1 capital (equity capital and disclosed reserves). Risk adjusted assets were the sum of adjusted with four risk buckets (0 %, 20%, 50% and 100%) assets of on and off balance sheet items.

Basel I Accord was criticized for the fact that mainly focused to credit risk, disregarding other types of risk and at the same time offering a simplistic approach on defining risk weights. The lack of economic foundation in the definition of capital ratio, as well as concerns regarding the “cooking of the books” from banks to adjust the ratio, were some of the growing evidence that questioned the initial definitions and pushed on alternative approaches regarding risk and capital requirements.

A new amendment in 1993 allowed banks to use their internal models approach to estimate VaR (Value at Risk). Furthermore the development of the technology allowed banks to develop their own internal rating models, in order to align the amount of risk they undertake on a loan with their overall targets (the internal rating based approach). Another two approaches, the full models approach (FMA) and the pre-commitment approach (PCA) includes also market risks.

In essence the new approaches introduced through the years indicate that the original Basel I Accord did not consider the differentiations of banking institutions, was more like a “one-size” approach than a flexible framework and for these reasons had to be revised. The revision took place in June 1999 introducing Basel II requirements presented in the next section.

1.2.

Basic characteristics of Basel II

Three main pillars are proposed in the International Convergence of Capital Measurement and Capital Standards: 1. The minimum capital requirements 2. The Supervisory Review Process 3. The Market Discipline.

As stated in the framework “the fundamental objective of the Committee’s work to revise the 1988 Accord has been to develop a framework that would further strengthen the soundness and stability of international banking system while maintaining sufficient consistency that capital adequacy regulation will not be a significant source of competitive inequality among internationally active banks”.

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The standardized framework has been implemented worldwide from Basel Committee members and non-members. This included also changes in local rules and regulation for many countries in order to achieve compliance with the new requirements and built the necessary infrastructure for implementation, which of ‘course implicated relative costs.

The minimum capital requirement as calculated from Basel II is:

MCR 

Capital  8% Credit Risk  Market Risk  Operational Risk

The capital ratio is calculated using the definition of regulatory capital and risk-weighted assets.

Regulatory capital is considered the equity capital and disclosed reserves. Due to the fact though that banks might have other substitutes of capital the Committee decided to divide the capital in two tiers – Tier 1 requiring at least 50% of the bank’s base capital and published reserves and Tier 2 consisting of supplementary capital limited to 100% of Tier 1. This gives the opportunity to the banks to regulate their capital according to their supervisory requirements and restrictions.

Total risk weighted assets are determined by multiplying the capital requirements for market risk and operational risk by 12.5%, which is the reciprocal of the minimum capital ratio of 8%, and adding the result to the risk-weighted assets for credit risk.

The measurement of credit risk can be done through standard approach – by using external rates for determining risk weights, or through an internal ratings method approach (IRBA) – by using basic internal rating where the bank calculates its probability of default or advanced internal rating where the bank calculates all risk components (except effective maturity).

For the measurement of operational risk that covers the risk of loss due to system breakdowns, employee fraud or misconduct, errors in models or natural or man-made catastrophes, among others, Basel II introduces three methods: 1. The basic indicator approach: the banks must hold capital for operational risk equal to the average over the previous three years of a fixed percentage of positive annual gross income.

2. The standard approach: divides the banks’ activities into 8 (eight) business lines (corporate finance, trading and sales, retail banking, commercial banking, payment and settlement, agency services, asset management and retail brokerage) and the total capital charge is calculated as the three-year average of the simple summation of the regulatory capital charges across each of the business lines in each year.

3. The advanced measurement approach: the regulatory capital requirement will equal the risk measure generated by the bank’s internal operational risk measurement system using quantitative and qualitative criteria. The usage of this approach is subject to supervisory approval.

For purposes only of market risk coverage Tier 3 capital is introduced consisted of short-term subordinated debt and is solely used to support market risk such as interest rates risk, foreign exchange risk and commodities risk.

Market risk is defined as the risk banks face due to movements in the market prices and two methods of counting it have been introduced in Basel II: the standardized measurement method and the internal models approach.

In summary, pillar I ensures that according to local regulations and supervisory restrictions every bank can calculate its own risk and the capital requirement can be higher in cases higher risk is indicated in the

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loans and lower for the lower-risk loans as well as it introduces the definitions of eligible capital under credit risk, operational risk and market risk.

The supervisory review process presented under Pillar II focuses on the need to supervise banks’ capital adequacy as well as to ensure the usage and development of advanced risk management techniques for the monitoring of bank’s risks. It covers areas that are not covered from Pillar I and notes the supervisor’s role to ensure compliance and fulfillment of the requirements.

Finally the third pillar of market discipline comes to complete pillar I and II by introducing some rules of disclosure to all the banks that implement the minimum capital requirements and the supervisory review process. These rules tempt to create a safe and sound banking environment, to maintain market discipline and to effectively inform the market on the bank’s exposures to risk enhancing comparability.

1.3.

Basel III and its innovation

The financial crisis of 2008 and its domino spread which affected to a large extent the banking sector in America and Europe resulted in a review of all regulations of the sector to ensure that they can effectively fulfill the initial reason of their existence: to ensure the financial health of a modern economy. Basel II and its requirements have been criticized for not taking into account the measurement of liquidity and lack of ability to offer protection from the financial crisis. These shortcomings were addressed in the development of Basel III since 2009, the publication of which was completed in 2013 by further enriching the main pillars of Basel II as follows: 1. Reinforced requirements for the minimal regulatory capital and for the liquidity 2. Reinforced process for the supervisory review regarding risk management and capital planning 3. Reinforced market discipline and transparency regarding risk.

Basel III comes to support tighter requirements for regulatory capital and liquidity in quantitative and qualitative terms, and expands in the calculation of credit risk, market risk, liquidity risk, concentration risk, operational risk and expected default risk. In this context it requires a complete synergy between risk management and financial management to determine and meet the strategic objectives of the banking institutions. Moreover Basel III allows for a concrete development of risk management in the respective institutions. The introduction of the requirements of Basel III was conducted in 2013 and is expected the usage of the new liquidity ration to take place during 2015-2018. The transition of the implementation of the requirements from Basel II to those Basel III is considered to take place gradually but the effects and implications regarding compliance are considered different for different countries.

An analysis of Moody 's on Basel III requirements refers to different countries facing different kinds of difficulties “en route” to harmonization with the requirements of Basel III: EU countries for example can more easily be transferred from Basel II to Basel III and they plan to do this through the distribution of a set of new rules for implementation from all the Central Banks of the member countries. US will have to pass from Basel I to Basel III, since it has not implemented the requirements of Basel II. Japan, Hong Kong, Singapore and Australia are mostly in the same situation with EU countries. While for other countries such as Russia, Eastern Europe, Middle East, Africa and Asia is difficult to determine how they will operate to this harmonization process and what politics will eventually choose for the implementation. Albania as an Eastern European country, needs to perform major steps to implement Basel II requirements as well it’s Basel III, the difficulties of which will be described in the next section of this paper.

Referring again to the major differences between Basel III and II the following should be considered:

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1. Basel III has higher capital requirements linked not only with its quantity, but its quality also.

2. Basel III provides measuring methods of economic cycles to forecast their trend and tendency and to manage (decrease) their effect from instant booms and bursts which may be created from the regulatory framework.

3. Basel III includes reinforced requirements regarding the trading of financial instruments and their securitization 4. Basel III defines and calculates VaR through stress tests to define the adequacy of the capital in case of economic changes.

The correct implementation of the Basel III requirements presumes a high quality database and the maximum devotion from the financial institutions, which ought to decide whether they’ll use their actual platforms or will need to rebuild new ones.

In this context of actual international developments regarding capital requirements as well as the other pillars of Basel II and III, we will analyze in this paper the challenges and benefits that the Albanian banking sector and the regulators will face.

2.

Literature review

Although the developments regarding capital requirements appear to have taken a new path with the introduction of Basel III, it is important to know the difficulties encountered and the problems that many countries had regarding the adoption of Basel II requirements as there are still developing countries which are far behind in terms of the implementation. Development, growth and ensuring the financial health of different countries with the application of Basel II, it has also brought new challenges for the banking sector, the knowledge of which makes us more careful in the way of the adoption of Basel III. The literature has offered a lot regarding the determination of these difficulties in a theoretical as well as practical point of view. In this section we’ll make a short review of this literature.

Basel II framework represents a new approach on defining the capital according to the bank’s size and riskiness as well as introduces internal measurement methods that need to be validated from the respective supervisors regarding their assumptions and integrity. It also gives the opportunity of collaboration between banks and the supervisors enhancing better market conditions and soundness and a healthier financial system. These changes from a traditional Accord of 1988 to a modern and flexible approach are considered important in terms of assessing their implications not only in the direct definition of capital requirements, but also in the long-term competition between banks. As a consequence literature has reviewed the framework’s effects in many aspects.

Gottschalk and Griffith-Jones, in 2006 have studied the implementation of the requirements of Basel II in low income countries (especially in Africa and Asia). Their research showed that although regulators have generally shown good will to implement the requirements of Basel II 's and harmonize their legal framework, they have followed a rather cautious policy on the implementation steps. The reason of it has been the complexity of the requirements of Basel II 's which increased even more as a result of lack of expertise from the regulators of these countries. The selection which some countries have made to adopt the standard and simple methods of Basel shows lack of experience but also lack of training by other experienced countries or by the Basel Committee for the adoption of the framework. Moreover this slow adoption plan shows the assessment of regulators for the increased impact that these requirements had in terms of local banks towards international banks that operate in these countries which affects in continuance the competition in the market. International banks are likely to pursue more sophisticated methods than local banks and this could affect their capital requirements giving them the competitive advantage. Substantially

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all these countries have pursued a policy of slow adoption simultaneously assessing problems or challenges created by the new accord. Even today many of these countries have not totally adopted the requirements of Basel II. Conford in 2006 in his paper related with the review of Basel II implementation, risks encountered during the implementation and characteristics of international banking services that are substantially affected by the implementation defines a set of factors to be considered among which: the ability to find people that properly understand the implementation from either the regulator or a commercial banks’ prospective (assuming that the regulator and banks under Basel II it would have a very close cooperation), the application of different methods between parent and subsidiaries operating in different countries, where the latter are obliged to follow local regulators, determining the best method for calculating regulatory capital (standard or based on internal rating methods), the special influence that foreign banks will encounter in the competitive markets where they operate, the changes in the regulatory capital, which for some banks are translated into increase and new requirements for capital and for some may be a relief and finally the banking lending practice, which depending on the appetite for risk that each bank has and the regulatory requirements is directed towards certain categories of customers. All these factors are defined as important not only for the countries under the supervision of the Basel Committee, but even for those which are not.

Griffith- Jones and Sprat have argued on the negative effects of Basel II to the developing countries.

They analyze and state that the usage of standardized approach in the measurement of credit risk would reduce short-term lending, the removal of the distinction between OECD and non- OECD countries will benefit the latter, highly rated non-OECD sovereigns will be more benefited than low-rated ones, highly rated banks in low rated countries will have the chance to reflect their creditworthiness in the international market, the introduction of external methods of creditworthiness would introduce pro-cyclical effects in the ratings and the functioning of External Credit Agencies (ECAs) even though may use uniform approaches these may not reflect the factors of a national economy rating. Furthermore they argue that the internal rating based approach would give the competitive advantage to larger banks and not to the developing ones reducing the funds they need and so becoming poorer. The dominance of large international banks in the market would also create the unification of economic cycles and would influence on larger crises increasing systemic instability. The authors propose especially for the developing countries the internal rating based approach to be postponed from implementation, as it would worsen their economic conditions and if implemented the probability of default to grow on a linear and not an exponential scale. Also they propose further development of the standardized approach to reduce the incentives towards short-term lending, to expand the number of risk buckets and to introduce public elements in the models of ECAs. In the context of measuring if Basel II enhances financial stability Wray argues that the requirements of the framework provide better risk assessments methods, ensure supervision and greater transparency, but cannot ensure a sounder and healthier financial system. This due to the fact that the new procedures introduced in the framework would lead to a significant larger reduction of regulatory capital than expected and internal rating models used from banks would lead to divergence and non-uniformity between them.

These drawbacks are mainly linked with the fact that the framework can’t do something regarding the primary sources of financial instability.

But even the framework can’t maintain financial stability; it can reflect it, as presented by Frank Heid in 2007. The author investigates the cyclicality of the Basel II requirements and proves that in times of financial instability or economic turndown capital buffer will decrease because of the rise in the risk weights that compensate the decrease in lending. He argues that the impact of Basel II on aggregate demand is significant, especially in economies where investors are based on bank lending.

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A different point of view is presented in Tanaka, 2002 research paper, where using a general equilibrium model and a representative bank it is shown that capital adequacy is an important determinant in the interest rates elasticity and the loan supply as well as it reduces the effectiveness of monetary policy as a tool for simulating output during recession.

Helmreich and Jaeger in 2008 in their paper for the presentation of the global consequences by the implementation of Basel II show that developed countries like US which have been the initiators of setting regulatory capital requirements, now seem more drawn on the implementation, EU members states are more likely to implement the requirements, while non - members depending on the problems they encounter have chosen a longer route to implementation. The authors refer to the case of Albania in particular by suggesting that Albania has recently required to adopt Basel II because of the large number of foreign banks operating in the country. Regarding the reasons for the difficulties authors refer to the same factors presented above from the literature.

Regarding the effect of the rules of Basel II on increasing the productivity of banks , the research of Delis, Molyneux and Pasiouras, 2008, proved that in contrary to the statistically significant results on the effect of regulations that promote private monitoring requirements, Basel II regulatory capital ( pillar I) does not seem to affect the productivity of banks. Of the three pillars of Basel II, the most important in terms of the impact on the productivity growth of banks is market discipline, indicating that transparency in providing the information can positively affect the development of the banking sector in different countries.

Cho in 2013 in his dissertation presents the main reasons for implementing the Basel requirements and determines through statistical models to what extent has the implementation of the requirements on a global level been managed. The author sets as the main reason that different countries adopt requirements, the importance that they have in ensuring the financial health and stability of the banking sector and also notes that the rate of implementation on a global level is not the same and comparable. Some countries have adopted all the requirements of Basel II , while others are still in the initial stages. It is important however to say that all countries are turning to adoption despite the problems they may encounter.

We could refer to many similar researches, but in summary they have all tried to measure the implications of the framework of Basel II, to critically view and investigate its effect in the economies, either they are developed or developing, to assess the macroeconomic effects that would have after full adoption.

Their main purpose is to give highlights on better understanding the requirements, as this will result in better implementation.

3.

Methodology

The Albanian banking sector has started to operate since 1998 and is structured, regulated and monitored periodically from the Central Bank (Bank of Albania). Banks play the most important role in the local economic growth and in the financial intermediation. The main purpose of the Bank of Albania is to maintain a healthy financial system, to control it and to publish reports and reviews in order to ensure its transparency. In this context the regulator has undertaken the harmonization of the capital requirements for the Albanian banking sector, which has created a new era in the aspect of banks’ reporting, their better control and insurance of the financial health of the economy. In this section we’ll present a comparative analysis of the Albanian regulatory framework and Basel II requirements to define the level of their harmonization as well as the difficulties in the implementation of Basel II with a special focus on the capital requirements.

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3.1.

Comparative analysis of the local regulatory framework and the Basel II standards

According to a report from the Governor of the Bank of Albania in 2005, Albania was not estimated to be ready for implementation of the Basel II framework for several reasons mostly linked with being a developing country. As we have expressed above for developing countries the challenge of adopting the requirements is greater than their ability to adapt. Albania as a developing country has a pronounced lack of knowledge on the use of sophisticated methods of risk, there are no rating agencies and banks invest their liquidities in governmental bonds, which according to Basel can increase the demand for capital and exacerbate the financial situation of the banking sector. The growing demand for market discipline makes it even more challenging the setting of rules and transparency for the banking sector after the crisis of 1997, considering the highly sensitive and high impact of the information provided to the public. According to the Governor, of course it is worth mentioning the fact that the banking sector consists largely of foreign banks, which can adopt methods for risk assessment, for which the local regulator may not have the expertise needed to control as such creating a challenge for the local market. Besides the above, two new challenges are added which deal with the creation of local rating agencies and the creation of an action plan that will guide commercial banks in a gradual transition to the adoption of Basel II requirements. For these reasons it was decided and implemented by our regulator a more cautious tactics applying an intermediate level of the requirements from Basel I and Basel II and adoption of a new regulation by the end of 2014.

In July 2013 the Bank of Albania issued the decision no. 48 dated 31.07.2013 for the adoption of the regulation "On the capital adequacy ratio" which enters into force on 31.12.2014 and automatically reverses the regulation "On capital adequacy ratio" dated 05.05.1999. Commercial banks are ordered at this point to take measures for the proper application of the regulation, which includes: defining the criteria and rules for calculating the capital adequacy ratio and determination of the minimum capital adequacy ratio. This regulation besides adopting new definitions includes the calculation of operational risk identified in the section above as non-existent in the actual regulations. The new regulation adopts the standard method for measuring credit risk and counterparty credit risk exposures weighted with a certain percentage according to their risk classification and credit quality. Credit quality is determined by an external rating institution accepted by the regulator. All exposures are classified in classes (15 in total) which take a risk coefficient defined by the regulation. The new regulation refers particularly to foreign credit institutions, how they can be recognized, licensed and how their assessments can be used in determining the risk weights. Techniques for mitigating credit risk are recognized by this regulation and are applicable by placing several types of methodologies that banks must apply. Also, this regulation refers to the treatment of securitized exposures and the calculation of their values using specific weights and their evaluation by an external rating agency.

Counterparty credit risk which is measured also by the standard method, includes determining the exposure value of financial derivatives based on concrete methods described in the regulation. At this point even though the regulation does not define any of the internal rating methods (Internal Rating Based Approach) under Basel II, still allows for the use of external rating by external rating institutions, which are regulated in particular.

Market risk for purposes of determining the regulatory capital includes the evaluation of all positions in financial instruments and in goods held for trading purposes. In this regard, the regulation introduces the methods of calculating the capital requirement for market risk as the sum of capital requirement for the foreign exchange position risk and concentration risk plus the capital requirement for all positions of the bank that include foreign exchange positions, goods, repayments. As such the regulation gives the opportunity to banks to select among the methods described the one that forecasts the better situation with respect to its position in financial instruments. Even in defining the capital for market risk the regulation adopts the standard method for determining the weights avoiding internal model methods.

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Finally Chapter VIII of the regulation introduces operational risk and for the first time defines two of the three methods under Basel II to be used for the regulatory capital calculation for operational risk: a simple index method and the standard method.

In summary of the above it is evident that the Bank of Albania through the introduction of this regulation comes closer than ever to implement the requirements of Basel II. However this is done following a conservative approach and applying the standard methods of weights and specified coefficients to avoid the use of internal rating models by commercial banks, which can be complex and difficultly audited by the regulator.

The main challenge for the harmonization of regulations seems to be completed to some extent by the regulator, but what remains is its implementation from the banking sector. What are the future challenges; is an analysis that will perform immediately below.

3.2.

Challenges and opportunities for the Albanian banking sector in implementing decision nr. 48 dt. 31.07.2014

The decision described above for the regulator itself constitutes a milestone in the path taken to harmonize the regulatory framework. From the standpoint of implementation however is still an emerging challenge.

Albanian banks can consider the implementation of some of the requirements of Basel under this regulation as a way to maximize their value or the value of their shareholders, which stems from the effective risk management, the efficient allocation of resources and capital, the implementation of prices based on risk and lower demand for capital calculated on the basis of the credit rating. This regulation although generally follows standard method for calculating risk-weighted assets, it is worth to mention that for the first time takes into account the operational risk and market risk according to specific methods defined by the regulator.

More efficient risk management comes as a result of systematic monitoring of capital levels according to risk, making more alert the relevant departments dealing with calculations but also any other employee of the institution who begins to evaluate issues related to risk. Furthermore the more efficient risk management allows but also motivates managers to better distribute the resources and to create added value for the institution. The distribution of human resources within the institution is based on the risk appetite that banks have and on the entities that support appropriate functions while minimizing costs. While the added value is based largely on the method of approach that banks will select.

The usage of the risk methods in pricing policies helps institutions to achieve a better cost-income ratio, creates a common basis of understanding for the parties involved in the process, gives a more competitive price for the client and of course the bank creates a comparative advantage in terms of risk-income ratio.

The performance measure of the banking institution can be performed more accurately taking into account the adjusted with the risk income and based in that the specification of the further strategy for maximizing the value of the bank can be defined.

Also the transparency required by the regulator deploys the institution in relation to the perception that the market has for it; the more transparent is the bank the better is assessed by the market, which is directly reflected on its value. The implementation of this regulation must also be seen from the perspective of improving the relationship regulatory – bank through the work towards a common objective.

Concluding about opportunities it is clear that they are directed primarily at maximizing the value of the institution through achieving their compliance with regulatory requirements.

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On the other hand the implementation of this decision is not easy. Banks should be more prepared to face the challenges.

Firstly they have to create groups of experts who understand the regulation in its complexity and analyze the main problems that would face in implementing it. These groups must be in constant contact with the regulator out of whom they should get clarifications on the ways of implementation of the regulation. They also need to decide which approach to follow based on the information available since each selection has a direct effect on the capital requirement. At this point the preliminary analysis of the data available and how they affect the capital requirement should be carried out taking into account different scenarios.

Secondly they must ensure that they possess all the data required to perform the necessary calculations.

At this point problems lye in two perspectives: the data quantity and quality. Given that the banking system is relatively young and composed of foreign banks, it must be said that for most banks core banking systems are taken from their parent. In this regard the sophistication that these systems can have is different in terms of the data quantity sufficient for the requirements of the regulation. But even if these data are assumed to be complete, their quality is a separate issue which should be analyzed prior performing the final reporting.

Thirdly the creation of COREP reporting format required by the Bank of Albania is a challenge because banks have to decide on the basis of a cost – benefit analysis if they should engage internal staff to develop the reporting system or will invest in computing programs especially to perform this function. This decision has a direct effect in terms of costs associated with having the vision in the use of software; at this point the banks should also anticipate possible changes in legislation and how these changes may affect their informative systems.

Moreover banks will need to change their internal procedures and their means of control related to the implementation of the new regulation which of course involves additional costs.

Finally, banks will need to train their staff not only to understand the new requirement, but also to make it known that despite statistical models that do not have any inaccuracies, what remains the key to any process is the professional human judgment, which prevails in any decision.

Concluding it is has to point out that it is extremely important that banking institutions should understand the benefits and the difficulties of the implementation of this new regulatory framework, since this will be the best way on their precise and accurate compliance.

4.

Conclusion

In modern economies the financial health is considered as one of the most important factors in the progress and development of countries. This fact is considered not only by academics but also by banking supervisors. For this reason, the Basel Committee has developed a regulatory framework, known as Basel I, II and III. The implementation of these regulations from different countries under the supervision or not of Basel has created opportunities, but also challenges as they appear in the literature. The important part at every step is the tendency to further regulate issues that each framework has emerged, including solutions in his successor. So Basel III is currently the most comprehensive framework regarding the inclusion of all the shortcomings that emerged from the first two frameworks during their implementation.

Albania, as a developing country is in the process of implementing a hybrid between Basel I and II, as the regulator considers that it is appropriate for the country's financial situation and structure of the banking sector. The banking sector at this point has to recognize the ways of maximizing the value from the use of this framework and successfully manage the constraints so as to achieve the implementation of the regulation by the end of 2014.

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5.

References

[1] Andoni, A. (2013). Basel III challenges in the Albanian banking system. The Macrotheme review.

[2] Auer, M., Pfoestl, G., & Kochanowicz, J. (2011). Basel III and Its Consequences. Accenture.

[3] Banka e Shqiperise: laws and regulations of supervisory authority.

[4] Cadiu, C., & Mars, M. (n.d.). Basel II Pillar 3: Challenges for banks. Global perspectives on challenges and opportunities .

[5] Caruana, J. (2006, March). The implementation of Basel II. Banco de Espanya.

[6] Chabanel, P.-E. (2011). Implementing Basel III : Challenges, Options & Opportunities. Enterprise Risk Solutions.

[7] Cho, Y. B. (2013, January). Why do countries implement Basel II? An analysis of the global diffusion of Basel II implementation. London: The London School of Economics and Political Science.

[8] Conford, A. (2006). The global implementation of Basel II: prospects and outstanding problems. New York and Geneva: United Nations.

[9] Delis, M. D., Molyneux, P., & Pasiouras, F. (2008). Regulations and productivity growth in banking. Working paper series, University of Bath.

[10] Gottschalk, R., & Griffith-Jones, S. (2006, December). Review of Basel II implementation in Low-Income Countries. University of Sussex: Institute of Development Studies.

[11] Griffith-Jones, S., Segoviano, M. A., & Spratt, S. (2002). Basel II and developing countries: diversification and portfolio effects. Working Paper.

[12] Grifith-Jones, S., & Spratt, S. (n.d.). New Basel Capital Accord has a net negative effect on developing countries?

Globalisation and poverty.

[13] Heid, F. (2007). The cyclical ffects of the Basel II capital requirements. Journal of Banking and Finance, 38853900.

[14] Helmreich, S., & Jager, J. (2008). The implementation and the consequences of Basel II. Working paper series nr.

47.

[15] Institute, F. S. (2012, July). Basel II, 2.5 and III implementation. FSI survey.

[16] Mao, J. (2008). Basel II: implementation issues and concerns. ABA Journal.

[17] Rodriguez Valladares, M. (2011). Basel III: Can it be implemented in emerging markets. MRV Associates.

[18] Roldan, J. M. (2005). The Benefits and Challenges of Implementation of Basel II in Europe. Committe of Banking Supervision.

[19] Scalera, F. (2012). Why the implementation of advanced measurement approach in operational risk management isn't a so good idea: the Albanian banking system case. International Journal of Business and Commerce, 47-55.

[20] Services, O. F. (2009, August). Key challenges and best practices for Basel II implementation. An Oracle white paper.

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Post-Soviet countries: the journey from resource-driven economies to knowledge based-economies. Focus on ICT sector Valentina Botan 1  1

Academy of Economic Studies of Bucharest, Romania

Abstract. After the dissolution of USSR the Soviet republics’ economies were resource-driven, but only few of them were rich in highly tradable natural resources. They were Russia, Azerbaijan, Ukraine and Kazakhstan. These countries had registered an important economic growth due to natural resources exports, but became prisoners of the so called “Dutch disease”. Moldova, Georgia, Armenia, Belarus or Baltic States hadn’t any highly tradable natural resources such as oil or gas and had to focus on developing other sectors of economy and have set as a priority the development of ICT sector. The purpose of my study was to find out who has performed better in developing the ICT sector from ex-Soviet republics, what is the correlation between the ICT sector development and the abundance in natural resources. Will the thesis that countries rich in natural resources are less open to knowledge and innovation be confirmed?

Keywords: ICT sector, post-Soviet countries, natural resources, Dutch disease, resource-driven economies JEL Codes: O13, O33, O57, P270.

1.

Introduction

When leaving the “USSR yard” (or USSR camp, in other’s vision), many of Soviet republics’ economies, where resource-driven. What was before “shared” between the sister-republics had to be sold at profitable prices on a free market. It become quickly obvious for the new countries that their products are not enough competitive for the external markets. Only natural resources still had their clients abroad, even if the price for raw materials was low and fluctuant. Besides that, countries like Moldova, Georgia, Armenia, Belarus or Baltic States hadn’t any highly tradable natural resources such as oil or gas. Others, like Russia, Kazakhstan, Azerbaijan or Ukraine in some extent had exploited inefficiently their natural resources and had become prisoners of the so called “Dutch disease”1. Only in the past 10 years the government of these countries, becoming aware of the pitfall to remain dependent only on natural resources without diversifying their economies had started to elaborate and implement strategies in order to reverse “the curse of natural resources”2. When post-Soviet countries started to develop their economies under the rules of market 

Bachelor in Economy from the Academy of Economic Studies from Bucharest, Post-university Studies in International Relations at National School of Political Studies and Administration Tel.: + 40765485266;. e-mail address: valentinne2000@yahoo.com 1

Resource-led export booms have often led to exchange-rate appreciation that has made other sectors, including manufacturing, less competitive in world markets and has led to domestic cost inflation. Such effects have been dubbed “Dutch disease,” an expression coined by The Economist in 1977.

2 Globally almost 80 percent of resource -driven countries have below average levels of income; more than half of these are not catching up – as per Richard Dobbs, Jeremy Oppenheim, Adam Kendall, Fraser Thompson, Martin Bratt, and Fransje van der Marel, Reverse the curse: Maximizing the potential of resource-driven economies, McKinsey Global Institute Report December 2013, exhibit 8)

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economy, they found it too difficult and maybe too late to develop some economic sectors where the western economies had already a long and successful history in background such as manufacturing and the majority of services sectors. Having lost that train, some of them understood that there is one they still can catch and compete with western economies and that was the IT sector. So they have started the “journey” from resource-driven economies to knowledge-based economies. It is interesting to see if and who from these countries have reached the destination or are closer to it. In this research I have tried to find out who has performed better in developing the ICT sector from ex-Soviet republics, what is the correlation between the ICT sector development and the abundance in natural resources. Will the thesis that countries rich in natural resources are less open to knowledge and innovation be confirmed?

2.

Methods and data

This study aims to confirm or infirm the thesis: that countries rich in natural resources had developed less successfully their ICT sectors. It will be focused on 10 ex-Soviet republics: Armenia, Azerbaijan, Belarus, Estonia, Georgia, Lithuania, Latvia, Moldova, Russian Federation and Ukraine which had become independent states after USSR dissolution, in 1991. I didn’t include in my study the other 5 former Soviet republics from Central Asia: Kazakhstan, Turkmenistan, Kyrgyz Republic, Tajikistan and Uzbekistan because of the lack or very scarce information on ICT sector in these countries.

After gathering the information on available indicators related to ICT sector development from World Bank, IMF, WTO, UNCTAD, Eurostat and official statistical sites of analyzed countries, I have decided to focus on the following indicators: 

ICT share in GDP;



ICT services export share in total exports;



ICT services export share in GDP;



Share of people employed in ICT activity on total employed people

The year of reference I’ve chosen to analyse is 2012 (for some indicators is 2013). This is the year with most statistical data available for the majority of analyzed countries and a year when these countries have celebrated their age of majority as independent states.

I have selected the indicators mentioned above because they reflect in my opinion more objectively the performance and the results of ICT sector independently from the country’s overall economic development.

Other ICT indicators which are often used when assessing a country’s ICT capabilities are the ICT infrastructure and access, ICT access and use in households, ICT use in business, but all of them are more related to the infrastructure required to develop ICT sector and not so much to the ICT sector’s “final product”. These indicators are also important because they actually ensure the basis for ICT sector development and it is worthy to be mentioned that in the majority of analyzed countries these indicators are at a good level, if compared to global statistics. The ICT infrastructure was almost inexistent at the beginning of 90’s in post-Soviet countries, therefore these countries have built it using the newest technologies and now, in many of them, some digital indicators such as internet connection speed or broad band coverage are at a higher level even than in the western countries as per statistics provided by OECD (Organization for Economic Cooperation and Development)3.

Another commonly used benchmark is the ICT expenditures (ICT spending in per capita and absolute terms and as a percentage of GDP), but this indicator depends too much on country’s policymakers and was 3

http://www.oecd.org/sti/broadband/oecdbroadbandportal.htm

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very fluctuant in the past decades depending on countries’ economic priorities, that’s why I will not use it in my analysis.

I will present bellow the data source and methods of calculation of analyzed indicators.

2.1.

ICT share in GDP

It was difficult to assess even such a generally used indicator for the economy, because ICT sector is not analyzed as a separate economic sector indicator in the official statistical reports. Therefore this indicator has been gathered from different sources, mostly from information provided by IT associations from these countries. However it was important, in my opinion to analyze the ICT sector as a share from GDP, because due to the totally different size of analyzed economies, if calculated in absolute terms it won’t reflect the reality.

2.2.

ICT Services Exports share in Total Exports

This indicator was analyzed separately for 2012, but also for 2005, 2010 and 2011 in order to notice the tendency. The data has been retrieved from World Bank Exports Statistics and calculated by dividing ICT services exports (BoP, current US$) on Exports of goods and services (BoP, current US$) 4.

2.3.

ICT services exports on GDP

This indicator will help us to see what is the influence of ICT sector exports on country’s revenue reflected in GDP, but also to see if the concerns of many economists that GDP of Russia, Azerbaijan or Ukraine is highly dependent on natural resources exports and these countries should pay more attention on diversifying their “export bucket” also by exporting more ICT services, are justified. The data on ICT services exports have been retrieved from International Monetary Fund, Balance of Payments Statistics Yearbook and Data Files corroborated with Data from Database: World Development Indicators, for the GDP of each analyzed country.

2.4.

Share of people employed in ICT activity on total employed people

This indicator has been calculated with the information gathered from various sources. For Armenia, Belarus, Moldova and Ukraine the figure of total employees in ITC was provided by the Report provided by EU –Eastern Europe and Central Asia, Gateway for ICT Research and Innovation, EAST HORIZON5 which I have divided on total employed people, figure retrieved from official statistical sites of these countries. The data for Estonia has been retrieved from Digital Agenda 2020 for Estonia issued by the Ministry of Economic Affairs and Communications6. For Latvia, the most recent figure I could find was for 2010 and it has been provided in Eurostat report - Percentage of the ICT personnel divided on total employment figure from the official statistical site of Latvia7.For Azerbaijan the Indicator was calculated by dividing the number of people working in Information and Communication sector as per official statistical site8 on the total number of employed people. The figure for Russia is calculated as per the data from the Russian IT Association Report9 divided to the total number of employed people in 2011 as per official statistical site10.

4

Data source is http://data.worldbank.org/indicator/BX.GSR.GNFS.CD/

5

Available on http://eeca-ict.eu/countries/http://eeca-ict.eu/countries/ 6 Available on https://e-estonia.com/wp-content/uploads/2014/04/Digital-Agenda-2020_Estonia_ENG.pdf.

7

Available on http://www.csb.gov.lv/en/dati/statistics-database-30501.html. For Lithuania the figure was provided in the article http://www.lithuaniatribune.com/62925/lithuanias-ict-sector-amongst-the-most-attractive-in-central-and-eastern-europe-201462925/ 8

http://www.stat.gov.az/indexen.php APKIT in collaboration with McKinsey & Company, Report on “The Measures for IT Sector Development in Russian Federation. A Business Community Approach”, November 2012, Moscow retrieved from www.apkit.ru/files/Strategy_APKIT_2012_vr.pdf and http://www.gks.ru/bgd/regl/b12_04/IssWWW.exe/Stg/d03/2-rin-trud.htm page 31 9

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3.

Results and analysis

The analysis of first indicator shows that indeed the ICT share in GDP of resource-rich countries such as Russia, Azerbaijan or Ukraine is under 2%, while in Armenia is 2%, in Belarus – slightly above 3%, in Latvia and Lithuania is 3,7% and the champions in this rating are Estonia and Moldova with almost 5 and 9% accordingly (see table 1). Unfortunately, this indicator is not available for Georgia.

Table 1

Ranking

Country

1

Moldova

% ICT share in GDP 8,9

2

Estonia

4,9

http://estonia.eu/about-estonia/economy-a-it/economy-innumbers.html

3

Latvia

3,7

http://www.liaa.gov.lv/trade/industry-profiles/informationand-telecommunications-technology-industry

4

Belarus

3,1

http://eeca-ict.eu/countries/

5

Lithuania

3,1

Investment possibilities in Lithuania - Innovation Circle

6

Armenia

2

http://eeca-ict.eu/countries/

7

Azerbaijan

1,9

http://eeca-ict.eu/countries/

8

Russian Federation Ukraine

1,3

http://www.gazeta.ru/business/2012/10/29/4827945.shtml

1,24

http://www.unn.com.ua/ru/news/1318416-chastka-it-uvvp-ukrayini-torik-sklala-1-24

9

source http://eeca-ict.eu/countries/

While Estonia is being already recognized as an “IT tiger” of Eastern Europe, the high influence of ICT sector on Moldova’s economy may be surprising for many. One may argue that ICT sector has such a great influence on Moldova’s GDP only because other economic sectors have very low performance. Even though, the fact that ICT shows good performance can be an important step for the economic long-term development of this country, as ICT sector, in opposition with mining sector for example, is recognized for bringing qualitative and sustainable growth.

The fact that ICT sector brings only 1% to Russia’s GDP while the contribution of natural resources to GDP as per World Bank Data11 is above 18% is not seen as a good proportion by the Russian policymakers and strong strategies are elaborated and implemented in order to boost the ICT sector in Russia so that, by 2020 this indicator should get to 4% according to APKIT and McKinsey analysis from 2012.

Far more alarming is the comparison of Natural resources share in GDP vs ICT share in GDP is in Azerbaijan, where the difference between 38,5% and 1,9% respectively talks by its self (see Figure 1).

10 11

http://www.gks.ru/bgd/regl/b12_04/IssWWW.exe/Stg/d03/2-rin-trud.htm http://wdi.worldbank.org/table/3.15

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Azerbaijan government has acknowledged this macroeconomic imbalance and has set an ambitious target to grow the ICT sector share in GDP which should reach 9% by 202012.

Ukraine, even if considered to be still a resource driven economy 13 has a much less disproportion between the contribution of natural resources and ICT sector to country’s GDP (see Fig. 1)

Fig. 1: Share of Natural Resources Rents in GDP vs ICT share in GDP (2012)

ICT services exports share in GDP (year of reference 2013) indicator has been calculated by dividing ICT service exports (BoP, current US$) by country’s GDP. This indicator is reflected in Figure 2.

Fig. 2: Share of ICT services export in GDP in 2013

12

http://www.trend.az/business/it/2266546.html According to Nataliya Bezrukova; Vitaliy Svichkar DUTCH DISEASE IN UKRAINE: ASSESSMENT OF THE DOMESTIC EXPORT PROBLEMS Source:Economic Annals¬XXI (Економічний часопис¬ХХІ), issue: 07¬08(2) / 2014, pages: 4¬7, retrieved from www.ceeol.com 13

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This indicator is highest in Estonia, seconded by Latvia and Moldova. Russian Federation and Azerbaijan are occupying the last positions, repeating the ranking of the first indicator (ICT on GDP). Thus, this indicators is also confirming the thesis that countries rich in natural resources have less developed their ICT sector.

Share of ICT Services Export in Total Exports indicator shows that Moldova, Estonia and Latvia perform better when we talk about ICT services exports. Good performance on this indicator is also shown

by Armenia. In Belarus, Lithuania and Georgia, this indicator situates near 2% which means that the ICT services export doesn’t have a significant impact on these countries’ economies.

Fig. 3: Share of ICT Services Export in Total Exports, year of reference 2012

When talking about resource driven economies, which are as per criteria singled out by McKinsey & Company, Inc.14 (2012) countries where the resource export (oil, gas, minerals) makes up more than 20% of exports of the total country exports such as Russia, Ukraine and Azerbaijan, this indicator is at a lower level.

However these countries are aware of the risk on remaining dependent on natural resources exports, therefore they have implemented strategies for diversifying their “export bucket”. One of these strategies is related to ICT sector development. In Ukraine, these strategies have started to show some results and this is reflected by the relatively higher level of ICT services export share in total exports, which has reached almost 5%. We see that Ukraine has performed better in diversifying its export by increasing the ICT services exports share also when analyzing the dynamics of this indicator, starting from 2005 (figure 4).

While in absolute terms Russia exports more ICT services than other countries from the region if calculated as a share from total exports it is only 3,4%, a figure that is still very low when comparing to 64% representing the share of natural resources exports in total exports.15

14

Richard Dobbs, Jeremy Oppenheim, Adam Kendall, Fraser Thompson, Martin Bratt, and Fransje van der Marel, Reverse the curse: Maximizing the potential of resource-driven economies, McKinsey Global Institute Report December 2013 15

according to http://www.resourcegovernance.org/countries/europe/russia/overview

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Azerbaijan has absolutely alarming situation when we talk about export diversification, the ICT service export share is only 1,96% while share of extractive exports in total reaches 95% (!)16

Fig. 4: ICT services export on total export tendency in %

Figure 4 shows also that almost in all 10 analyzed countries starting from 2005 there is a tendency to increase the share of ICT services export in total exports, and only in Azerbaijan, the indicator in 2012 was at a lower level than in 2005.

Share of people employed in ICT indicator grants the leadership again to Estonia, where 4% of total employed people are working in ICT sector, seconded by Moldova with 3% and Belarus with 2,2%. In other analyzed countries this indicator is under 2%, as shown in the figure bellow.

Fig. 5: % of people employed in ICT sector 16

according to http://www.resourcegovernance.org/countries/eurasia/azerbaijan/overview

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This indicator isn’t very homogeneous, because in some statistics it includes only the persons working in IT sector, in other this figure includes all employees with ICT related activities across all labour market, but still it is an important benchmark when analyzing the ICT sector development.

It is notable that this indicator has the highest levels in Estonia and Moldova and lowest, in Russia and it is also low in Ukraine and Azerbaijan, confirming the correlation noticed also in the analysis of the previous indicators. The countries rich in natural resources have a less developed ICT sector, also from the ICT employment point of view.

ICT employment indicator is important to be analyzed not only from the perspective of the added value to the economy, there is another significant aspect related to ICT jobs. First of all we should outline the quality of these jobs. As per Chris Vein, World Bank Chief Innovation Officer for Global ICT Development these are “good jobs, which have positive economic and social implications for workers and society”. Hence, the ICT sector has also a very positive social impact, reducing the gap between the poor and rich, and contributing to the creation or consolidation of the middle class. On the contrary, in the resource driven economies, exploitation of natural resources had, in the majority of cases, a negative social impact, by allowing a small group of persons to benefit from them, see the cases of oligarchs in Russia and Ukraine.

4.

Discussions and conclusions

Having in mind the Millennium Development Goals which have demonstrated that the ICT sector had an important impact on combating the poverty, but also the Europe 2020 targets, especially when referring to R&D and innovation, the Baltic states, but also Moldova, Ukraine and Armenia have developed strategies to boost the ICT sector development. The analysis of indicators has proven that the progress has already shown up in the Baltic States and Moldova and good results are starting to appear in Ukraine, Belarus and Armenia.

Russian Federation has also adopted a strong strategy for developing the ICT sector and even Azerbaijan, the most dependent on natural resources country from the analyzed pool is working on strategies for boosting the ICT sector. But, the evidence is that countries rich in natural resources have registered a much lower progress if comparing with the others from the analyzed pool.

As stated also in McKinsey Global Institute Report (2013) :“Bluntly, too often an abundance of resources has not enhanced economic development, but impeded it”. Resource rich countries haven’t managed to ensure that their resource wealth is used for productive long-term investment that creates clear benefits for a large share of the population. These countries have often failed in spending wisely the benefits coming from abundance in natural resources for many reasons, including because of corruption and macroeconomic instability.

Another discussion that can emerge from this study is what should be the role of the state in developing the ICT sector in analyzed countries, in converting their resource endowments into long-term prosperity. It is clear that the ultraliberal approach “that any measure taken by the state for resolving a economic or a social problem has more negative than positive effects”17 is not to be followed in this situation as relying on the “spontaneous harmony” in countries rich in natural resources is not an option. It has been already proven that the capitals and human resources will tend to go to the oil and gas and mining sectors, where they can get easier and quicker material advantages. People, will always try to get maximum advantages with minimum effort. That is why it is important for the governments of these countries to play a role in redirecting the main 17

Francisco Vergara “Temeiurile filozofice ale liberalismului”, Ed. Nemira, 1998.

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business forces and capitals into the ICT sector, determining them to invest more time and resources in innovation activities.

5.

References

[1] Alekseev M., Conrad R. The Natural Resource Curse and Economic Transition // Duk Sanford School of Public Policy Working Papers Series. 2009. SAN09-04 [2] APKIT in collaboration with McKinsey & Company, Report on “The Measures for IT Sector Development in Russian Federation. A Business Community Approach”, November 2012, Moscow retrieved from www.apkit.ru/files/Strategy_APKIT_2012_vr.pdf [3] Bezrukova, N. ; Svichkar, V. Dutch Disease in Ukraine: Assesment of the domestic Export Problems Source:Economic AnnalsXXI (Економічний часописХХІ), issue: 0708(2) / 2014, pages: 47, on www.ceeol.com [4] Owen, D., Behle, H. and Baldauf, B. Literature Review on Employability, Inclusion And ICT, Report 4: Review of available data sets on employability and ICT(2012).

[5] de Hoyos, M., Green, A.E. , Barnes, S.A., Behle, H., Baldauf, B. and Owen, D.. Literature Review on Employability, Inclusion and ICT, Report 2, ICT and Employability, European Commission Joint Research Center, 2013 available from http://ftp.jrc.es/EURdoc/JRC78601.pdf [6] Dobbs, R., Oppenheim, J., Kendall, A., Thompson, F., Bratt, M. and van der Marel, F. Reverse the curse: Maximizing the potential of resource-driven economies, McKinsey Global Institute Report December 2013, available from http://www.mckinsey.com/insights/energy_resources_materials/reverse_the_curse_maximizing_the_potential_of_r esource_driven_economies [7] Fredriksson, T. Socio-economic benefits of ICT diffusion and its significance for trade and development, Presentation at WTO Symposium on 15th Anniversary of the ITA Geneva, 14 May 2012 [8] Hellewig, J. Putin 2000 – 2014, Midterm Interim Results: Diversification, Modernization and the Role of the State in Russia’s economy A Wittgensteinian look at the Russian economy, December 2014, http://www.awaragroup.com/upload/Awara-Study-Russian-Economy.pdf [9] Kabanda, G. Impact of information and communication technologies (ICTs) on millenium development goals (MDGs): Context for diffusion and adoption of ICT innovations in East and Southern Africa, Journal of African Studies and Development, Vol 3(8), August 2011.

[10] Oomes, N., Kalcheva, K. Diagnosing Dutch Disease: Does Russia have the symptoms? © 2007 International Monetary Fund WP/07/102 [11] Sabadash, A. ICT Employment Statistics in Europe: Measuring Methodology, European Commission 2013 [12] Sachs, J.D. and Warner, A.M. Natural Resource Abundance and Economic Growth. // NBER Working Paper Series, Working Paper 5398. Cambridge, MA: National Bureau of Economic Research. 1995 [13] Samulevicius, J. Speeding up of Lithuania’s economy via globalization, ISSN 1822 8402 European Integration Studies 2013. No. 7 [14] Shapiro, R. J. and Mathur, A. The contribution of Information and Communication Technologies to American Growth, Productivity and Prosperity.

September, 2011 available from

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http://www.tiaonline.org/gov_affairs/fcc_filings/documents/Report_on_ICT_and_Innovation_Shapiro_Mathur_Sep tember_8_2011.pdf [15] UNDP, Human Development Report 2011: Sustainability and Equity: a Better http://www.undp.org.bz/wp-content/uploads/2011/11/ HDR_2011_EN_Compressed.pdf

Future

for

All

[16] United Nations Conference on Trade and Development UNCTAD, Information Economy Report 2012. The software industry in the developing countries. United Nations, New York and Geneva 2012 available from http://unctad.org/en/PublicationsLibrary/ier2012overview_en.pdf [17] United Nations Conference on Trade and Development UNCTAD, Information Economy Report 2011. ICTs as an Enabler for Private Sector Development. United Nations, New York and Geneva 2011 available from http://unctad.org/en/PublicationsLibrary/ier2011_en.pdf [18] Vassilieva O, Nakopleniye Chelovecheskogo capitala i izobiliye prirodnych resursov, Voprosy Economiky, 2011, Nr. 12 [19] Vergara, F. “Temeiurile filozofice ale liberalismului�, Ed. Nemira, 1998

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Did suburbanization cause residential segregation? Evidence from U.S. metropolitan areas Boishampayan Chatterjee1 

1

Institute of Management Technology, Ghaziabad, India

Abstract. Population suburbanization has been long held as a cause for increasing racial residential segregation in US metropolitan areas. This paper hypothesizes that rapid suburbanization between 1960 and 2000 has caused an increase in racial residential segregation in U.S. metropolitan areas. Using the 1947 national interstate highway plan as an instrument for suburbanization and decennial Census data from 1960 to 2000, this paper finds that central city population decline (suburbanization) causes racial residential segregation in a metropolitan area to rise. Estimation results from both long difference and panel regressions are robust to an array of specifications. Had there been no suburbanization between 1960 and 2000, racial residential segregation on average would have declined by about 4 percentage points more than what is observed in the data.

Keywords: Suburbanization, Residential Segregation, Highways, Metropolitan area JEL Codes: R11, R23, R40, J1

1.

Introduction

This paper tries to establish a link between racial residential segregation and population suburbanization by assessing the extent to which rapid central city population decline (suburbanization) explains the observed pattern of racial residential segregation in US metropolitan areas. The idea is that if the central cities lose population, of which most are affluent whites, then it will keep the metropolitan areas to remain residentially segregated. In particular, the empirical specification in this paper tests the hypothesis that greater central city population decline causes racial residential segregation in a metropolitan statistical area (MSA) to decline slower over time. In other words, population suburbanization raises racial residential segregation.

The vast literature on residential segregation provides evidence of high segregation in the United States from the time when ghettos were born. As blacks migrated to urban areas, ghettos were formed and cities developed vast areas mostly filled with black population. In 1890, the average urban black was living in a neighborhood that was 27 percent black. By 1940, this percentage went up to 43 percent. Between 1940 and 1970, ghettos consolidated and expanded with the peak year of segregation being 1970. In 1970, the average black in US urban areas lived in a neighborhood that was 68 percent black. In 1990 this percentage was 56 (Cutler, Glaeser, and Vigdor, 1999).

On the other hand, population decline in US central cities provides evidence of rapid suburbanization from 1950 onwards. In 1950, 57 percent of MSA residents were located in the central cities. In 1970, the share was 43 percent while in 1990 it was 37 percent (Mieszkowski and Mills, 1993). A recent study by Baum-Snow (2007) showed that between 1950 and 1990, the total population of central cities in the United States declined by 17 percent in spite of population growth of 72 percent for the MSAs. 

Assistant Professor, Institute of Management Technology, Ghaziabad. Tel.: +9101203002230; fax: +9101202827895. E-mail address: bchatterjee@imt.edu.

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Existing literature on segregation argues that residential segregation may rise as neighborhoods expand and people become relatively more mobile. Improvements in the transportation infrastructure encourage suburbanization as people become increasingly able to live in the suburbs and commute to the city to work.

If this suburbanization is essentially “White Flight” from the city to the suburbs, then it will cause US metropolis to be more residentially segregated (Boustan, 2010).

Previous studies identify suburbanization as one of the causes for the racially segregated pattern of residential location in US metropolitan areas. In particular, Jackson (1985) emphasizes that federal subsidization and encouragement of suburbanization reinforced racial residential segregation. Massey and Denton (1988) find Hispanic and Asian segregation to be strongly related to suburbanization but BlackAnglo segregation was not. Cutler, Glaeser, and Vigdor (1999) regress the indexes of dissimilarity and isolation on city population and density and find evidence that larger or denser cities have higher levels of segregation.

On the other hand, decentralized racism and collective action racism (Cutler, Glaeser, and Vigdor, 1999) provide explanation how racial residential segregation may occur because of the individual whites’ decision to live with other whites and collective actions taken by the whites to enforce separation from the blacks. Preference to reside among people of like income, education, race and ethnicity induces the affluent middle class to live in the suburbs.

Thus, households willing to move to their preferred location will do so if they get the opportunity to relocate. For instance, in the 1960s, the construction of interstate highway system was considered as one of the major causes of metropolitan suburbanization.

The primary concern that may arise in estimating the effect of suburbanization on residential segregation is because of the problem of reverse causality. As suburbanization may affect residential segregation, people who want to segregate may choose to suburbanize. The main contribution of this paper is to circumvent the problem of reverse causality between residential segregation and suburbanization by using instrumental variables (IV) as an identification strategy. In particular, the 1947 national interstate highway plan is used as an instrument for suburbanization. The motivation for using this instrument comes from the recent study by Baum-Snow (2007), where he has shown that the construction of new limited-access highways has contributed to central city population decline across MSAs in the United States.

Using aggregate data at the MSA level for decennial years from 1960 to 2000, regression equations are estimated for an array of specifications for long difference and panel settings. Given that residential segregation and central city population has fallen during the chosen sample period of this study, this paper finds that greater decline in central city population causes a lesser decline in racial residential segregation in a metropolitan area.

The rest of the paper is organized as follows. Section 2 discusses the relationship between racial residential segregation and suburbanization and why interstate highway qualifies as an instrument. Section 3 discusses the empirical methodology and the data. Section 4 describes the trends in suburbanization and residential segregation. Section 5 presents the results from the long difference and panel regressions. Section 6 concludes.

2.

Residential segregation, suburbanization, and highways

Residential segregation on the basis of race can happen when households have direct preference over race or particular neighborhood characteristics that vary by race. For instance, Schelling’s (1971) model of “neighborhood tipping” shows how an all-white neighborhood, with residents having different tolerance levels toward black neighbors, starts tipping and culminates into an all-black neighborhood. Again, preference of households for local public goods may lead to residential stratification on the basis of income.

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This ‘Tiebout sorting’ (Tiebout, 1956) may generate racial residential segregation if race and income are correlated.

With the development of highway construction, many residents of metropolitan areas chose to live outside the central urban area and commute to work by automobile or mass transit. This process of suburbanization is more relevant to the affluent section of the population who can afford to live in the suburbs.

Past studies have observed that between 1950 and 1990, there had been a substantial decline in total population of central cities despite population growth in metropolitan area as a whole (Baum-Snow, 2007), and that mostly urban whites were moving to the suburbs (Boustan, 2010). During 1940-1970, central cities experienced black migration from the rural South, and the urban whites responded to this black influx by relocating to the suburbs.

The goal of this paper is to test the hypothesis that rapid suburbanization during 1960 to 2000 has led US metropolitan areas to be more racially segregated. To address the concern of reverse causality emerging from whites’ willingness to move away from blacks thereby causing suburbanization, central city population is instrumented with the number of highways in the 1947 national interstate highway plan. A recent study by Baum-Snow (2007) shows that one new highway passing through the central city reduces its population by about 18 percent.

The identification strategy used in this paper exploits the exogenous variation in the national highway plan, which was designed not to facilitate local commuting but to link faraway places. As a result, some MSAs that are located nearer to other population centers received relatively more interstate highways than others (Baum-Snow, 2007). Thus the rates of suburbanization varied across the metropolitan areas depending upon the number of highways assigned to each metropolitan area. The empirical work in this paper compares the changes in the level of residential segregation across metropolitan areas with different rates of suburbanization. The 1947 national interstate highway plan is purged of any endogeneity because the intention of the plan was not to provide people with highways so that they can suburbanize, and thus, is not correlated with residential segregation. The highway plan thus provides a valid instrument in the sense that the construction of new highways encouraged suburbanization but is not directly correlated with residential segregation in other ways.

3.

Empirical specification and data

The effect of suburbanization on residential segregation is measured by relating the long run changes in metropolitan area segregation level to the long run changes in central city population. The main advantage of using long difference regressions is that the long run changes of central city population from 1960 to 2000 provide a clear picture of the suburbanization process and the evolution of the residential pattern over a long period.

The empirical specification of the model estimated using long difference regressions is described as follows:

Ri   0   1 S i   2 Di   3 H i   4 Gi   5 I i   6 I i2   7 Ai   8 M i   9 Yi   10 Vi   i

(1)

where Ri is racial residential segregation measured by the dissimilarity index and S i denotes constant geography central city population in city i. Thus S i measures the degree of suburbanization. Di is a vector of demographic variables, including variables such as MSA population, population density, black and foreign born shares.

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Vector Hi includes variables such as growth potential of industries, historical black migration, 1950 central city area and 1950 MSA population. Gi measures 1962 number of local governments in an MSA. I control for segregation level in 1960, denoted by I i , in order to account for the fact that some MSAs had either low or high segregation to begin with. Since dissimilarity index can only vary between 0 and 1, extreme values of the index at the initial period would imply that it would have a unidirectional pattern in its variation thereby inflicting bias on the estimated coefficient of the central city population variable. In addition, I include the square of initial segregation level ( I i2 ) to account for any nonlinearity present in the data. Finally, the variables Ai, Mi, Yi, and Vi measure agricultural employment, manufacturing employment, median family income, and median gross rent in an MSA. The first stage of the instrumental variable regression is given by

S i   0   1 PH i   2 Di   3 H i   4 Gi   5 I i   6 I i2   7 Ai   8 M i   9 Yi   10 Vi   i

(2)

where PH i is the number of planned highways in the 1947 national interstate highway plan for MSA i. The IV estimates are obtained by replacing S i in equation (1) with the predicted degree of suburbanization obtained from equation (2).

The identification strategy is to instrument the changes in central city population with rays passing through the central city in the highway plan.2 Using actual highways poses endogeneity problems because whites may respond to segregation by building more highways to facilitate suburbanization, but the highway plan did not mean to facilitate suburbanization and thus does not have this problem. I use the data from Baum-Snow (2007) on the number of highways in the 1947 national interstate highway plan to instrument central city population.

Racial residential segregation is measured using the index of dissimilarity proposed by Duncan and Duncan (1955). This is a widely used index which measures the extent to which blacks and nonblacks occupy different areas of a city. This measure has been used by Cutler, Glaeser, and Vigdor (1999) and is interpreted as what share of blacks (or whites) would need to change residential areas for the races to be evenly distributed. The value of the dissimilarity index ranges between 0 and 1. The index is calculated at the MSA level and use Census tracts as neighborhoods.

Following Baum-Snow (2007), I use the change in total population of the central city in each metropolitan area for each decennial year from 1960 to 2000 to measure suburbanization. I use the central city population data from 1960 to 1990 created by Baum-Snow (2007) where each metropolitan area is assigned with one central city. Neighborhood Change Database (NCDB) provides decennial census data at the tract level. Tracts in year 2000 that fall within the 1950 central city geography are aggregated to obtain the total constant geography central city population in 2000. The dataset cover altogether 129 MSAs across the United States.

County and City Data Books (CCDB) is the source of all the demographic variables included in the regression. CCDB provides decennial census data aggregated to counties of at least 250,000 inhabitants.

County level data on total, black and foreign born population are aggregated to form MSAs using the 1960 standard metropolitan area definition.

The data for the variables included in the vector Hi come from sources such as 1952 CCDB, Bureau of Economic Analysis (BEA), US Department of Commerce, and 1962 Census of Governments. The data on historical black migration are obtained from the Inter-University Consortium for Political and Social Research (ICPSR).

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Regression equations are estimated at the MSA level for differences between 1960-80, 1960-90 and 1960-2000. OLS and IV regression models are used to estimate equation (1), with the 1947 national interstate highway plan as an instrument for suburbanization in the IV regressions. In estimating equation (1), I also use regional dummies to absorb any variation in segregation across regions. Both OLS and IV regressions for the long-difference model are run with census division fixed effects.

Since metropolitan areas are unique in many ways, using a panel data with metropolitan area fixed effects would control for any time invariant heterogeneity across MSAs. Using an exogenous source of variation in the planned highways as instrument would provide estimates of suburbanization purged of endogeneity arising from potential reverse causality. The full model specification used for panel regressions is as follows:

Rit   0  1 S it   2 Dit   3Yit   4Vit   5 Ait   6 M it   7Wi   8Tt  Wi * S it   it (3) where Rit is the measure of residential segregation in metropolitan area i at year t, Dit is a vector of metropolitan area characteristics, which includes metropolitan population, population density, share of black and foreign born population and S it is the share of central city population out of total MSA population. For the instrumental variable regressions, S it is substituted with the predicted central city population share from the first stage. Yit, Vit, Ait and Mit denote median family income, gross median rent, share of agricultural and manufacturing employment in MSA i at year t respectively. Wi and Tt are regional and year dummies capturing regional and year fixed effects. Regional dummies are interacted with central city population to control for any regional differences in the effect of suburbanization on residential segregation. Both OLS and IV regressions are estimated with MSA fixed effects.

If residential location patterns take longer than ten years to respond fully to the changes in highway infrastructure, then panel estimates without smoothing rays will be biased toward zero due to slow transition to new equilibria. (Baum-Snow, 2007). To construct the instrument for the central city population in a panel setting, I follow Baum-Snow with a minor change. Unlike Baum-Snow (2007), central city population is instrumented with the number of interstate highways in the plan multiplied by the fraction of highway miles completed at time (t-1). This is because highway construction lagged by one period is likely to be more exogenous than highway construction at time t. The data on miles of highway completed and opened to traffic for till 1994 were obtained from Baum-Snow (2007). The post 1994 data is obtained from Federal Highway Administration (FHWA) website.13 4.

Trends in segregation and suburbanization

Table 1. Trends in Residential Segregation, Central City Population, and MSA population Year

Average Segregation

Total City Population

Total MSA Population

MSA with above average black share

MSA with below average black share

Dissimilarity Index

Average City population

Dissimilarity Index

Average City population

1960

0.75

42.99

110.29

0.75

0.57

0.74

0.19

1970

0.75

40.98

127.69

0.77

0.58

0.75

0.15

1980

0.66

36.44

137.68

0.69

0.53

0.64

0.13

1990

0.61

35.73

151.19

0.65

0.49

0.58

0.13

2000

0.56

35.19

208.69

0.61

0.43

0.53

0.17

Percent change

-25.4%

-18.13%

89.22%

-18.6%

-24.5%

-29.3%

-10.5%

ISSN: 2247-6172 Review of Applied Socio- Economic Research (Volume 9, Issue 1/ 2015), pp. 30 URL: http://www.reaser.eu e-mail: editors@reaser.eu Population figures are in million. Black share of population is defined as above (below) average in an MSA if the black share in that MSA at time t is greater (lower) than the average black share at time t.

Table 1 provides an overview of the trends in black-nonblack residential segregation, central city population, and MSA population. From Table 1 it can be seen that there has been a substantial population movement from the central city to the suburbs, with the central city population falling by 18 percent and MSA population rising by 89 percent between 1960 and 2000. One noticeable fact in Table 1 is that central city population dropped marginally during the 1990-2000 period while there has been a considerable increase in MSA population in that time period. This trend in central city population indicates that MSAs on average were not experiencing much suburbanization in the post 1990 period.

Residential segregation was at its peak in the 1970 with the value of the dissimilarity index being .752.

From 1970 onwards, segregation fell persistently with the value of dissimilarity index dropping down to .56 in 2000. This decline in segregation level can be attributed to rising income and education level of blacks with a change in attitude of the blacks toward living in a ghetto (Massey and Denton, 1987).

Table 1 also shows the average segregation level and the central city population according to the proportion of black population in MSAs. MSAs with above average and below average black share of population had almost the same average level of segregation in 1960. For the later years, MSAs with above average black share of population have higher segregation than MSAs with below average black share.

Central city population declined consistently from 1970 onwards for the MSAs with above average black share. As for the MSAs with below average black share, average central city population had a downward trend till 1980 but had risen by about 30 percent between 1990 and 2000. MSAs with higher black share experienced greater black in-migration than MSAs with comparatively lesser black population.

Suburbanization happened at a faster rate in those MSAs as whites responded to the influx of black population.

The main observation from Table 1 is that the level of the dissimilarity index has persistently fallen between 1960 and 2000. Again, central cities had a substantial population loss during the same time period.

However, the key is whether the reduction in residential segregation is smaller where suburbanization is faster. This paper attempts to test the hypothesis that cities that experienced greater suburbanization had a slower decline in racial residential segregation. .2

1960-90 Changes

-2

0 2 4 Change in central city Population

-.6

-.4

-.2

0

Change in Segregation

.2 0 -.2 -.4 -.6

Change in Segregation

1960-80 Changes

6

-2

0 2 Change in central city Population

4

.2 0 -.2 -.4 -.6

Change in Segregation

1960-2000 Changes

-4

-2 0 2 Change in central city Population

4

Fig. 1: Suburbanization and Change in Racial Residential Segregation

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Figure 1 gives a graphical exposition of the relationship between the change in residential segregation and the change in central city population between 1960-80, 1960-90 and 1960-2000. Higher negative values for the change in central city population implies greater decline in central city population, meaning more suburbanization. Similar explanation holds for the change in residential segregation as well. Suburbanization and change in residential segregation has a negative relation for all the three long run changes. Greater central city population loss is associated with lesser decline in residential segregation.

5.

Results

This section presents the OLS and IV regression results from the long difference and panel regressions corresponding to the equations (1), and (3).

Long Difference Regression Results Results in Table 2 show that the change in residential segregation is negatively associated with the change in central city population decline. In fact, significant IV estimates for the change in central city population suggest that suburbanization causes metropolitan areas to be more residentially segregated. For the 1960-80 long difference IV regression, a one standard deviation increase in suburbanization causes residential segregation to rise by 5.2 percentage points. For 1960-90 and 1960-00, the effect is about 4.7 and 3.6 percentage points respectively.

The first stage F-statistic ranging between 11.17 and 19.37 provides evidence that the 1947 national interstate highway plan is a strong predictor of the change in central city population.

The causal estimates of the effect of suburbanization on residential segregation are strong and significant, especially for the 1960-80 and 1960-90 long difference regressions. US metropolitan areas experienced considerable loss in central city population between 1960 and 1990. Average segregation level also declined during that period. An implication of the results obtained from the IV regressions in the long difference model is that the MSAs in which central cities experienced greater suburbanization had a significantly lesser fall in racial residential segregation.

Among the other independent variables, higher black share of population has a significant negative association with racial residential segregation in all the long difference regressions. This result might be attributed to rising income and education level of blacks with a change in attitude of the blacks toward living in a ghetto. The other two variables strongly related to segregation are the central city area and the central city population density. We can see that segregation is higher in larger and denser cities, a result similar to the one obtained by Cutler, Glaeser, and Vigdor (1999).

The first thing noticeable from Table 2 is that the longer the difference between the two years, the smaller is the absolute magnitudes of the IV estimates. This finding may indicate that the changes in residential segregation and central city population has been the most during the 1960-1990 time period and the process of suburbanization petered out in the post 1990 period. Average residential segregation consistently dropped during this period, which might be attributed to amendments in antidiscriminatory policies and changes in attitude of the nonblacks toward the blacks.

Secondly, the absolute magnitudes of the OLS estimates are bigger, the longer the difference between the two years. Longer the time people get, the more they can respond to segregation by suburbanizing. In that case, the bias arising from reverse causality will be bigger the longer is the period of the difference between the two years.

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1960-80

Change in log CC population

Change in log MSA population

Change in CC population density

Change in black share of population

Change in foreign born share

1950 CC area

Change in median family income

Change in median gross rent

Change in percent manufacturing employment

Change in percent agriculture employment

Reject null of no endogeneity at 5% level

OLS

1960-2000

OLS

IV

-0.011

-0.052*

-0.021**

-0.047**

-0.025**

-0.036

(0.007)

(0.027)

(0.009)

(0.021)

(0.011)

(0.023)

-0.013

0.035

0.077**

0.095***

0.029**

0.031***

(0.050)

(0.056)

(0.038)

(0.027)

(0.013)

(0.011)

0.020*

0.042***

0.021

0.039*

0.034**

0.042**

(0.011)

(0.013)

(0.018)

(0.021)

(0.015)

(0.018)

-0.063***

-0.071***

-0.061***

-0.068***

-0.033**

-0.035**

(0.022)

(0.025)

(0.017)

(0.015)

(0.015)

(0.014)

-0.012

0.0054

-0.044**

-0.032*

-0.031**

-0.028**

(0.009)

(0.011)

(0.017)

(0.019)

(0.013)

(0.012)

0.065***

0.081***

0.056**

0.063***

0.051*

0.0545***

(0.017)

(0.018)

(0.022)

(0.018)

(0.027)

(0.020)

0.161

0.191

-0.214

-0.180

-0.210**

-0.198***

(0.146)

(0.155)

(0.156)

(0.142)

(0.089)

(0.077)

0.075

0.100

0.069

0.035

0.178

0.172*

(0.118)

(0.123)

(0.103)

(0.102)

(0.108)

(0.095)

0.069

0.090

0.036

0.036

-0.036

-0.049

(0.094)

(0.075)

(0.058)

(0.051)

(0.043)

(0.039)

0.018

0.011

0.057*

0.051

0.079**

0.068

(0.031)

(0.028)

(0.029)

(0.031)

(0.036)

(0.043)

Yes

Yes

Yes

Yes

Yes

Yes

First stage F-stat 2

1960-90

14.09

IV

OLS

11.17

IV

19.37

R

0.628

0.529

0.749

0.730

0.754

0.750

N

124

124

123

123

124

124

Census division fixed effects

Yes

Yes

Yes

Yes

Yes

Yes

Table 2. 1960-80, 1960-90, and 1960-00 long difference regressions

ISSN: 2247-6172 Review of Applied Socio- Economic Research (Volume 9, Issue 1/ 2015), pp. 33 URL: http://www.reaser.eu e-mail: editors@reaser.eu * p<0.10, ** p<0.05, *** p<0.01

Table 3. Average change in residential segregation: actual versus predicted 1960-80

Average change in

1960-90

(1)

(2)

(3)

Actual

Predicted

Actual

-0.092

-0.128

-0.142

1960-2000 (4)

(5)

(6)

Predicted

Actual

Predicted

-0.194

-0.193

-0.231

dissimilarity index Predicted average change in dissimilarity index is obtained by estimating the long difference regressions assuming no suburbanization.

Table 3 presents the actual and the predicted changes in racial residential segregation for 1960-80, 1960-90, and 1960-2000 long run changes. The figures in columns 1, 3, and 5 are the actual changes in the dissimilarity index as observed in the data. Columns 2, 4, and 6 show the changes in the dissimilarity index as predicted by the long difference model, assuming the rate of suburbanization to be zero for all the cities in the sample. Table 3 shows that on average, the decline in residential segregation would have been greater had there been no suburbanization. For 1960-80 long run change, the average decline in dissimilarity index would have been 3.6 percentage points more in absence of suburbanization. For 1960-90 and 1960-2000, it is by 5.2 and 3.8 percentage points respectively. Thus between 1960 and 2000, suburbanization has weakened the decline in racial residential segregation on average in US metropolitan areas.

Panel Regression Results Table 4 presents the results from panel regressions for decennial years from 1960 to 2000 as specified in equation (3).

The first two columns in Table 4 include the demographic variables, regional dummies and year dummies (not shown in the table) as controls in addition to the central city population variable. The last two columns report OLS and IV regressions adding further controls. Central city population is negatively associated with racial residential segregation and is statistically significant for all the specifications. For OLS(3), one standard deviation decline in the share of central city population is associated with a 8 percentage points rise in residential segregation.

For the panel IV regressions, the instrument is measured as the number of interstate highways in the 1947 highway plan times the fraction of highway mileage running through the central city of MSA i in year t-1. The instrument performs well in predicting central city population with F-statistics ranging from 14.75 to 17.96

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Table 4. Panel OLS and IV regressions with share of central city population as the dependent variable OLS1 Share of CC population

Log MSA population

Log population density

Log black share

Log foreign born share

IV1

OLS2

IV2

OLS3

IV3

-0.0723**

-0.114*

-0.0866**

-0.100*

-0.0842*

-0.0960*

(0.0341)

(0.0620)

(0.0428)

(0.0592)

(0.0443)

(0.0522)

-0.0502

-0.125**

-0.0545

-0.122**

-0.154**

-0.0631

(0.0511)

(0.0587)

(0.0552)

(0.0591)

(0.0682)

(0.0478)

-0.0300

-0.0120

-0.0234

-0.0110

-0.0145

0.0302***

(0.0179)

(0.0146)

(0.0172)

(0.0121)

(0.0163)

(0.0109)

0.0151

0.0480*

0.0142

0.0499*

-0.0153

-0.00507

(0.0227)

(0.0250)

(0.0222)

(0.0269)

(0.0215)

(0.0118)

-0.0170

-0.00859

-0.0226*

-0.0173**

-0.00496

-0.00474

(0.0125)

(0.00867)

(0.0124)

(0.00745)

(0.0196)

(0.00834)

0.0940

0.0769*

0.0353

0.0113

(0.0644)

(0.0412)

(0.0546)

(0.0254)

0.0171

0.0597

0.126

0.138***

(0.105)

(0.0614)

(0.0922)

(0.0451)

-0.00504

-0.00711

-0.00787

-0.00538

(0.0594)

(0.0384)

(0.0584)

(0.0330)

0.290

0.0504

0.110

0.240

(0.191)

(0.217)

(0.186)

(0.190)

Log median income

Log median rent

Share of manufacturing employment

Share of agriculture employment

Endogeneity

Yes

Yes

Yes

First stage F-stat

15.86

17.96

14.75

R2

0.652

0.539

0.678

0.550

0.725

0.557

N

645

645

641

641

641

641

Controls not shown: Year dummies. Regional Dummies, regional dummies and suburbanization interaction * p<0.10, ** p<0.05, *** p<0.01

Causal estimates of the central city population variable have the expected negative sign and are statistically significant at conventional levels for all the three specifications. For the baseline specification (IV1), a one standard deviation decline in the share of central city population causes metropolitan area residential segregation to rise by 11 percentage points. Again, regressions including manufacturing and agricultural employment as additional controls produce qualitatively similar coefficient estimates of the central city population variable, confirming that the estimates are not picking up any correlation between the

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1947 highway plan and future employment growth. As it can be seen from regression IV3, a one standard deviation decline in the share of central city population causes metropolitan area residential segregation to rise by 10 percentage points. Thus suburbanization over time has led the metropolitan areas to be more residentially segregated.

Among the other variables, dissimilarity index is strongly negatively associated with MSA population.

If differences in income across race contribute to racial residential segregation, then this segregation may fall because of an increase in MSA population if a significant portion of this population increase is better educated and higher income blacks. Median single family gross rent and median income is positively related to segregation. Higher rental prices may be a result of housing supply constraint due to various residential land regulations. As Rothwell (2009) finds, restrictive measures such as maximum density zoning have a strong negative effect on metropolitan housing growth. Regulatory regimes like this limit the supply of new housing and facilitate construction toward larger and more expensive homes inaccessible to minorities, thereby causing racial residential segregation (Massey and Rothwell 2009).

The absolute magnitudes of the OLS estimates for the central city population variable are always smaller than that of the IV estimates for both the long difference and panel regressions. This might happen due to the measurement errors arising from incorrectly measuring the suburbanization and residential segregation variables. The process of suburbanization may be more relevant to a particular section of the central city. In that case, the effect of suburbanization on racial residential segregation would be better captured by measuring suburbanization and segregation at smaller neighborhood levels instead of the entire central city.

6.

Conclusion

This paper tests the hypothesis that population movement from the central cities of MSAs in the United States between 1960 and 2000 have caused the MSAs to be more residentially segregated. This process of suburbanization consisted of mostly the nonblacks, who moved to the suburbs, and the central cities remained predominantly inhabited by the blacks. This population movement thus resulted in greater blacknonblack residential segregation.

Previous research viewed suburbanization as one of the factors that explain the observed segregated residential pattern in the United States. This paper contributes to the existing literature by identifying the direction of causality between suburbanization and racial residential segregation.

Using the 1947 national highway plan as an instrument for suburbanization and decennial census data from 1960 to 2000 in long difference and panel settings, this paper finds significant evidence that central city depopulation in fact caused metropolitan areas to be more residentially segregated. Estimation results from the 1960-80, 1960-90 long difference regressions and panel regressions yield significant negative coefficients for the suburbanization variable. A one standard deviation more decline in the central city population from 1960 to 2000 lessens the decline in dissimilarity index by 4 percentage points.

This paper finds that suburbanization has decelerated the fall in racial residential segregation on average in US metropolitan areas between 1960 and 2000. Had there been no suburbanization, black-nonblack residential segregation on average would have declined by .231 points, which is about 4 percentage points more than what is observed in the data.

7.

References

[1] Baum-Snow, N., Did Highways Cause Suburbanization, Quarterly Journal of Economics, 2007, 122(2), 775-805.

[2] Boustan, L. P., Was Postwar Suburbanization â&#x20AC;&#x153;White Flightâ&#x20AC;?? Evidence from the Black Migration, Quarterly Journal of Economics, 2010, 125(1), 417-443.

ISSN: 2247-6172 Review of Applied Socio- Economic Research (Volume 9, Issue 1/ 2015), pp. 36 URL: http://www.reaser.eu e-mail: editors@reaser.eu [3] Cutler, D. M. and Glaeser, E. L., Are Ghettos Good or Bad, Quarterly Journal of Economics, 1997, 112(3), 827872.

[4] Cutler, D. M., Glaeser, E. L. and Vigdor, J. L., The Rise and Decline of American Ghetto, Journal of Political Economy, 1999, 107(3), 455-506.

[5] Duncan, D. O. and Duncan, B., A Methodological Analysis of Segregation Indexes, American Sociological Review, 1955, 20, 210-217.

[6] Gardner, J. and Cohen W. Demographic Characteristics of the Population of the United States, 1930-1950: CountyLevel, ICPSR00020-v1. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 1992, doi:10.3886/ICPSR00020.v1.

[7] Iceland, J., Weinberg D. H. and Steinmetz E., Racial and Ethnic Residential Segregation in the United States: 19802000, US Census Bureau, Census Special Report, CENSR, 2002.

[8] Jackson, K. T. (1985), Crabgrass Frontier: The Suburbanization of the United States, Oxford UK: Oxford University Press [9] Massey, D. S. and Denton N., Trends in the Residential Segregation of Blacks, Hispanics, and Asians: 1970-1980, American Sociological Review, 1987, 52, 802-825 [10] Massey, D. S. and Denton N., Suburbanization and Segregation in US Metropolitan area, The American Journal of Sociology, 1988a, 94(3), 592-626.

[11] Massey, D. S. and Denton N., The Dimensions of Residential Segregation, Social Forces, 1988b, 67(2), 281-316.

[12] Massey, D. S. and Rothwell J., The Effect of Density Zoning on Racial Segregation in US Urban areas, Urban Affairs Review, 2009, 44(6), 779-806.

[13] Mieszkowski, P. and Mills E.S., The Causes of Metropolitan Suburbanization, Journal of Economic Perspectives, 1993, 7(3), 135-147.

[14] Rothwell, J. T., The Effects of Density Regulation on Metropolitan Housing Markets, Available at SSRN, 2009: http://ssrn.com/abstract=1154146 or http://dx.doi.org/10.2139/ssrn.1154146 [15] Schelling, T. C., Dynamic Models of Segregation, Journal of Mathematical Sociology, 1971, 1, 143-186.

[16] Tiebout, C. M., A Pure Theory of Local Expenditures, Journal of Political Economy, 1956, 64(5), 416-424.

[17] Wilson, W.J. (1987), The truly disadvantaged: The inner city, the underclass, and public policy, Chicago: University of Chicago Press.

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Predictors of work-life balance for women entrepreneurs in the North-East Region of Romania Dan Dumitru Ionescu 1, Alina Mariuca Ionescu 2 ď&#x20AC;Ť 1, 2

Alexandru Ioan Cuza University of Iasi, Romania

Abstract. The paper aims to investigate the predictors of work-life balance of women entrepreneurs in the North-East Region of Romania. It emphasizes features of interaction between professional and personal life in case of women and reviews main disturbance or enhancing factors that impact work-life balance of women entrepreneurs. A sample of 50 female entrepreneurs from the North-East Region of Romania was surveyed in order to assess their work-life balance and the factors that correlate with it. The study uses correlation and correspondence analysis to test the existence of a relationship between various factors in the fields of work and personal life, as well as factors of social and psychological nature and the way in which women entrepreneurs perceive their work-life balance. The outcomes of the study identify the degree to which the working hours of women entrepreneurs match family and social commitments and the frequency with which it happens that women entrepreneurs feel tension in the household regarding the time dedicated to workrelated activities as good predictors of work-life balance in case of women entrepreneurs in the North-East Region of Romania.

Keywords: work-life balance, women entrepreneurs, the North-East Region of Romania JEL Codes: C13, J16, J22, L26.

1.

Introduction

The issue of work-life balance in literature on women entrepreneurship is of interest in the context in which women face an unequal distribution of childcare and other household duties that become major barriers when they start and manage their businesses. The fact that besides completing the workplace demands, women entrepreneurs have to do the major part of child care and household duties makes the balance between their work and home roles be more difficult than for men. Being responsible for a business brings new challenges for women entrepreneurs in terms of finding a balance between their professional and personal life.

This paper aims to address this issue and to investigate the factors that influence the work-life balance of female entrepreneurs in the North-East Region of Romania. To reach this goal, the research first presents a short discussion of work-life balance specific features in the case of women entrepreneurs focusing on factors that disturb this balance or to the contrary support it. The next section outlines the methodological issues (data source and sample, variables, methods). The outcomes of a survey on 50 women entrepreneurs active in the North-East Region of Romania are then discussed in order to test the existence of a relationship ď&#x20AC;Ť

PhD. Corresponding authors.

E-mail addresses: dd.ionescu@gmail.com; alina.ionescu@yahoo.com.

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between various factors in the fields of work and personal life, as well as factors of social and psychological nature and the way in which women entrepreneurs perceive their work-life balance. The paper ends with the concluding remarks and references.

2.

Work-life balance of women entrepreneurs and factors that influence it

Pocock [1] states that work-life balance is: „…about people having a measure of control over when, where and how they work. It is achieved when an individual's right to a fulfilled life inside and outside paid work is accepted and respected as the norm to the mutual benefit of the individual, business and society”.

The ability to control the workplace and home environment and, therefore, balancing professional and personal life is many times more difficult for women entrepreneurs than for their male counterparts due to disproportionate division of domestic responsibilities. In many societies, family duties are considered to be the main responsibility of women, while men are viewed as the breadwinners of a family [2]. This situation involves the fact that work and life come with different sets of priorities and challenges for men and women.

Based on societal norms, men may concentrate on career as they are not expected to participate in household and child care. The same societal norms still expect women to focus on family care [3] and take a big part of responsibilities related to household, cooking and upbringing and education of children. Only after fulfilling these duties, women entrepreneurs can afford taking up the responsibility of a business as their participation in family life is often seen as independent from (and sometimes more important than) work [4]. Therefore, negotiation between work and home is, in case of women, unidirectional [3], in the sense that their involvement in the family life may have negative effects on work but their involvement at the workplace „must not” affect family life. That is why, when a business, a partner, children or elderly parents compete for the time, energy and attention of women, conflict management of inter-roles for women involves working in double or triple shifts.

Consequently, work-life balance disturbance occur as a result of a conflict situation between job demands and personal life duties.

In the case of women entrepreneurs, work demands may refer to:  Time requirements (number of working hours). Time pressure as a requirement of work that disturbs work-life balance manifests in the sense that the more time a woman entrepreneur dedicates to her business, the less time she has left for her family. Research showed that entrepreneurs work more hours than employees [5].  Requirements related to an imposed schedule (the degree to which the type of business and its management require a less flexible schedule).  Demands resulting from meeting company’s needs, such as financial support and business management (work stressors). Work stressors can produce symptoms of work overload, such as anxiety, frustration, tension and irritability [6]. These negative emotions can spill over from work to family contributing to work-family conflict.  Responsibilities to employees. As women entrepreneurs are responsible for the success of their own business and the income of their employees, their commitment to work is higher than of married women who are just employees.  Emotional requirements (need to succeed professionally, need to prove their value as entrepreneurs, need to establish themselves as successful business women).

Personal life demands refer to:  Parental demands (parental status, number of children, children’s age, share of child care, time dedicated to childcare). Parents tend to experience more conflict situations between work and family

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than entrepreneurs who are not parents, as they have to spend more time at home, taking care of their children. Younger children demand more of their parents’ time. Large families also are inclined to be more time demanding than small families [6]. Many researchers state that the number of children directly influences the demands from family [7]. Intuitively, taking responsibility for children at home requires dedicating time and energy for meeting their daily needs. Even though some results were not conclusive [8], Netemeyer et al. [9] and Kossek et al. [10] found significant relationships between the number of children living at home and the family interference with work.  Demands that appear in relation with female entrepreneur marital status. Marital status could be a strong predictor of the perceived family demand. Married female entrepreneur is likely to experience more demand from the family in the form of obligations to her husband that unmarried women do not have [11].  Household responsibilities (share of house work, time given to household duties). Although last decades have shown that men get involved in care giving to a higher degree, there are studies that found that women spend on the average about four times more time than men with such activities [12].  Caretaking of the elderly or other dependents besides children (number of dependents, time given to caretaking of dependents). It is necessary to consider also the relations of dependence (for instance, grandparents) that could directly impact the levels of family demand [13].  Free time demands.  Requirements concerning carrying out complementary activities to work (such as to continue studies and develop a talent/hobby).  Emotional requirements (need to have attention of family members, need of affection and support of the close ones).

Among the factors that help to improve work-life balance of the women entrepreneur, we can name autonomy and flexibility in the workplace, and family and other close people support in personal life.

Autonomy and the ability to manage her activities at the workplace should reduce the level of demand as the woman entrepreneur has the freedom to handle work demand without so many restrictive schedules and demands [11].

Flexibility given by the fact that the woman entrepreneur can make a decision on her own on her schedule ensures, for instance, a flexible schedule that can reduce the perceived work demand. A high number of women choose to work on their own as an alternative flexible path for a career allowing them to better manage their family duties [14]. Costin [15] found in the literature that women start their business to have more flexibility and freedom in organizing their commitments to job, spare time and family. The chance to adjust their working hours should thus allow female entrepreneurs to manage easier their time in fulfilling their workplace and home duties.

Family members supportive behaviour can help to buffer work-family conflicts experienced by some working women and, therefore, in ensuring a better work-life balance between the two main areas of life.

The support can be given as attitude, be of emotional nature or instrumental and can be targeted to entrepreneurs or to work [16]. Regarding family support to entrepreneur, family can provide support for home responsibilities or work obligations which potentially reduce family demand. Family support to work involves the fact that, in addition to reducing family demand, family members may work to reduce family duties, situation that specifically frees time and energy for work tasks, the family demands becoming even lower [11]. The husband (the partner) is an important part in the support network of women entrepreneurs, his support being a major asset for them [16]. In addition to husband’s support, the support of other people

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such as housekeepers or nurses that take over house and childcare responsibilities and can help in reducing work-life conflict.

Material and method

3.

Data source and sample

3.1.

A sample of 50 female entrepreneurs active in the North-East Region of Romania was surveyed in order to collect information on their work-life balance and the factors influencing it.

The respondents were identified through internet websites of female entrepreneurs’ networks from this region or through referrals obtained mainly from other entrepreneurs.

The following selection criteria were applied to maintain consistency:

 

The organisation has been founded by the female entrepreneur.

The organisation is at least 51% owned by a woman and the management and daily business operations are controlled by her.

General characteristics (age, county, rural or urban area) of female entrepreneurs sample included in the study are shown in table 1.

Table 1. General characteristics of the sample of female entrepreneurs Region of Romania: North-East Parameter (n = 50) Age (%) 18-24 0 25-34 16 35-49 56 50-64 24 65+ 4 County (%) Bacau 14 Botosani 4 Iasi 26 Neamt 4 Suceava 18 Vaslui 34 Rural or urban area (%) Rural 24 Urban 76

For the purpose of this study, a data collection tool in the form of a questionnaire was used. The questionnaires were sent to women entrepreneurs by email, after a previous telephone conversation, or were handed personally by people who have recommended them.

3.2.

Variables

Work-life balance was measured by a score given by respondents on a scale from 0 to 10 (0 – totally misbalanced, 10 – perfect balance) to balance between their professional life (work) and personal life (family, home, free time, etc.). We considered as potential predictors variables describing: woman entrepreneur’s home life (marital status; number of children in her care; number of her dependents other than children; number of hours spent daily and weekly on household activities), her work situation (number of employees; number of hours spent daily and weekly at work), as well as a few factors of social (different

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conflict situations that may appear between demands at home and at work) and psychological nature (certain women entrepreneur’s inner feelings that appear as a result of different conflicts between work and personal life demands).

The included social factors take the form of various conflict situations that may arise between work and home demands and are expressed by the following variables:

  

Do you fail to fulfil social obligations due to work?

Are your household activities interrupted by work-related phone calls?

To what extend your working hours match family and social commitments?

Psychological factors in this study refer to women entrepreneur’s inner feelings that appear as a result of different conflict situations between work and personal life demands, namely:

   3.3.

Do you feel torn between work and personal life demands?

Do you worry about work issues when you are at home?

Do you feel tension at home due to the amount of time dedicated to work?

Methods

To check if there is a relationship between demographic factors (marital status, number of children, and number of other dependents than children) and work-life balance of the surveyed women entrepreneurs, we analysed the distribution of scores given to work-life balance according to the values of each included factor.

For independent variables with numerical expression, we calculated Pearson correlation coefficients between the score given to work-life balance and each possible predictor.

As answers associated with social and psychological factors included in the study are expressed nominally (and namely Never, Very rarely, Very often or Not quite well, Well, Very well), exploring the possibility that these factors influence work-life balance perceived by women entrepreneurs in the NorthEast Region of Romania is carried out by means of correspondence analysis. This technique allowed us to draw a map of correspondences for each selected factor separately. These maps graphically illustrate the possible associations between scores given to work-life balance and answer categories of factors of influence. Also, the statistical test χ2 is used to test the existence of a relationship between each selected factor and the assessment of work-life balance. If the level of test significance noted sig. is low (for instance, lower than 0.05), then it can be stated that there is a relationship between the two studied variables.

4.

Results

The distribution of relative frequency of work-life balance scores by marital status of respondent (table 2) displays no pattern in the repartition of shares of each score among the analysed categories of women entrepreneurs, which means that it cannot be identified a relationship between the marital status of an entrepreneur and her work-life balance. Still, it should be noted that one of the categories, namely „widow”, did not appear in the sample.

Percentage distribution of work-life balance scores by the number of children a respondent has in her care (table 3) shows that more children she has in her care lower is her life-work balance, which means that her work-life balance is more misbalanced. Also, the resulted shares indicate a higher concentration of scores of 8, 9 and 10 among women entrepreneurs with no children or just one child in their care.

When comparing the distribution of women entrepreneurs who have children with that of those without children (table 3), it could be observed that the evaluations of work-life balance vary from very low scores (3 and 4) up to 10 in both categories. Nevertheless, it could be noted that a significantly higher percentage (71%) of women entrepreneurs with no children gave scores of 8, 9 and 10 to their work-life balance

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compared to the corresponding percentage of respondents having children (61.5%).

Percentage distribution of work-life balance scores by the number of dependents other than children found in respondentâ&#x20AC;&#x2122;s care (table 4) show that for the given sample it cannot be identified a relationship between the number of dependents at home and work-life balance of the woman entrepreneur as the shares spread does not show a specific pattern.

Table 2. The distribution of women entrepreneurs by marital status and work-life balance score Work-life Marital status balance score unmarried married consensual union divorced 3 14.3% 4 20% 2.7% 5 16.2% 6 20% 5.4% 14.3% 7 20% 20% 14.3% 8 40% 32.4% 100% 14.3% 9 29.7% 28.6% 10 8.1% 14.3% Total 100% 100% 100% 100% Source: Survey data Table 3. The distribution of women entrepreneurs by number of children in their care and work-life balance score Work-life Number of children Do you have children? balance score 0 1 2 3 Yes No 3 4.2% 4.2% 4 7.1% 9.1% 7.7% 5 6.7% 7.1% 100% 7.7% 16.7% 6 4.2% 7.1% 18.2% 11.5% 4.2% 7 4.2% 7.1% 18.2% 11.5% 4.2% 8 37.5% 28.6% 27.3% 26.9% 37.5% 9 29.2% 28.6% 18.2% 23.1% 29.2% 10 4.2% 14.3% 9.1% 11.5% 4.2% Total 100% 100% 100% 100% 100% 100% Source: Survey data Table 4. The distribution of women entrepreneurs by number of dependents, other than children, and work-life balance score Work-life Number of dependents balance score 0 1 2 3 3 2.5% 4 5.0% 5 10.0% 50% 6 5.0% 20% 25% 7 10.0% 8 30.0% 60% 100% 9 27.5% 20% 25% 10 10.0% Total 100.0% 100% 100% 100% Source: Survey data

Table 5 presents the values of Pearson correlation coefficients calculated between the number of children and that of other dependents and the scores given by respondents to their work-life balance, between the

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average number of daily and weekly hours spent for household duties and the work-life balance scores, between the number of employees and the score, as well as between the average number of daily and weekly working hours and the scores given by female entrepreneurs to their work-life balance.

For all selected indicators with numerical expression, there have been obtained negative values of Pearson correlation coefficients expressing an inverse relation between these indicators and work-life balance. All correlation coefficients have values in the interval (-0.200; 0). These values very close to zero of correlation coefficients indicate, for the sample, weak relationships between included factors and work-life balance. Also, all sig. values associated with these coefficients are higher than the significance threshold α = 0.05, which means that none of the estimated coefficients is statistically significant for the population of women entrepreneurs from which the sample was taken. The results do not identify any of the considered variables as an important predictor of work-life balance of women entrepreneurs in the North-East Region of Romania.

Table 5. Pearson correlation coefficients calculated between various predictors of work-life balance and work-life balance score Predictors of work-life balance Pearson correlation Sig. (2-tailed) coefficient Number of children -0.079 0.587 Number of dependents, other than children -0.130 0.368 Average number of hours spent daily with household duties -0.103 0.475 Average number of hours spent weekly with household duties -0.114 0.432 Number of employees -0.105 0.477 Average number of daily working hours -0.167 0.247 Average number of weekly working hours -0.140 0.332 Correlation is significant at the 0.05 level (2-tailed).

The maps of correspondences between work-life balance scores and answers categories of each selected factor taken separately, as well as the values of χ2 statistics significance calculated to test the existence of a relationship between each included factor and work-life balance have emphasized the following:

   

There could not be identified a relationship between the frequency by which woman entrepreneur fails to fulfil her social obligations due to work and her work-life balance score (sig. = 0.209 > α = 0.05).

There could not be identified a relation between the frequency by which household activities of woman entrepreneur are interrupted by work-related phone calls and her work-life balance score (sig. = 0.765 > α = 0.05).

Graphical representations of modalities indicate a greater closeness of the scores of 9 and 10 – corresponding to a higher level of work-life balance – to the answer Very rarely chosen by women entrepreneurs to describe the frequency with which these two events occur.

There is a relationship between the degree to which working hours of women entrepreneurs match family and social commitments and their work-life balance scores (sig. = 0.005 < α = 0.05). Graphical representation of the modalities of the two variables (figure 1c) indicates a strong association of the scores 9 and 10 with the answer Very well and of the scores 7 and 8 with the answer Well with which the women entrepreneurs assessed the harmonization between working hours and commitments outside work.

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a)

b)

c)

d)

e)

f)

Fig. 1: The map of correspondences between: a) the frequency by which woman entrepreneur fails to fulfil her social obligations due to work (Never, Very rarely, Very often); b) the frequency by which household activities of woman entrepreneur are interrupted by work-related phone calls (Never, Very rarely, Very often); c) the degree to which working hours of woman entrepreneur match family and social commitments (Not quite well, Well, Very well); d) the frequency of appearance of the feeling of being torn between work and personal life demands in woman entrepreneur (Never, Very rarely, Very often); e) the frequency of appearance of the feeling of worrying of woman entrepreneur related to work issues when she is at home (Never, Very rarely, Very often); f) the frequency with which woman entrepreneur happens to feel tension at home due to the amount of time dedicated to work (Never, Very rarely, Very often) and the score she gives to her work-life balance (from 0 to 10).

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



5.

There could not be identified a relationship between the frequency of appearance of the feeling of being torn between work and personal life demands in woman entrepreneur and her work-life balance score (sig. = 0.894 > α = 0.05). Graphical representation of the modalities of the two variables (figure 1d) indicates though a grouping of the scores 9 and 10 close to answer Never corresponding to this feeling frequency of occurrence. There could not be identified a relationship between the frequency of appearance of the feeling of worrying of a woman entrepreneur related to work issues when she is at home and her work-life balance score (sig. = 0.322 > α = 0.05). Graphical representation of the modalities of the two variables (figure 1e) indicates an association of the occurrence of the score 10 with answer Never and of the occurrence of score 8 with the answer Very rarely.

There is a relationship between the frequency with which a woman entrepreneur happens to feel tension at home due to the amount of time dedicated to work and her work-life balance score (sig. = 0.004 < α = 0.05). Graphical representation of the modalities of the two variables (figure 1f) indicates a strong association of scores 9 and 10 with the answer Never and scores 7 and 8 with the answer Very rarely by which the women entrepreneurs assess the frequency of occurrence of this feeling.

Conclusions

The results do not show any statistically significant relationship between variables describing woman entrepreneur’s home situation (marital status; number of children in her care; number of her dependents other than children; number of hours spent daily and weekly on household activities) and her work-life balance.

Also, there could not be identified a relationship between variables describing woman entrepreneur’s work situation (number of employees; number of hours spent daily and weekly at work) and her work-life balance.

Nevertheless, a higher concentration of scores of 8, 9 and 10 could be noted among women entrepreneurs with no children or having only one child in their care. It was also observed that a significantly higher percentage (71%) of women entrepreneurs with no children rated with scores of 8, 9 and 10 their work-life balance compared to the corresponding percentage of respondents who have children (61.5%).

Regarding the included social and psychological factors, the maps of correspondences between work-life balance scores and answer categories of each selected factor taken separately indicate a higher closeness of the scores 8, 9 and 10 – corresponding to a higher level of work-life balance – to the answers Never or Very rarely used by women entrepreneurs to describe frequency by which various conflict situations occur between their work and home duties. The values of the χ2 test and their significance demonstrate the existence of a statistically significant relationship between the degree to which working hours of a woman entrepreneur match family and social commitments and the score she gives to her work-life balance and between the frequency with which it occurs for a woman entrepreneur to feel the tension at home related to the amount of time dedicated to work and her work-life balance score.

The results show that it is not so much the amount of household duties and care putting a pressure on women entrepreneurs that produces disequilibrium of their work-life balance but the conflicts perceived by them between the demands of the two dimensions of their lives (professional and personal life).

6.

Acknowledgements

This work was supported by the European Social Fund through the Sectoral Operational Programme Human Resources Development 2007-2013, project number POSDRU/159/1.5/S/134197, project title “Performance and Excellence in Doctoral and Postdoctoral Research in Economic Sciences Domain in Romania”.

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7.

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[7] Jamal, M. Job stress satisfaction and mental health: an empirical examination of self-employed and non-selfemployed Canadians. Journal of Small Business Management 1997, 35 (4): 48-57.

[8] Kim, L.S. and Ling, C.S. Work-family conflict of women entrepreneurs in Singapore, Women in Management Review 2001, 16 (5): 204-221.

[9] Kossek, E.E., Colquitt, J.A. and Noe, R.A. Caregiving decisions, well-being, and performance: the effects of place and provider as a function of dependent type and work-family climates. Academy of Management Journal 2001, 44: 29-44.

[10] Netemeyer, R.G., Boles, J.S. and McMurrian, R. Development and validation of work-family conflict and familywork conflict scales. Journal of Applied Psychology 1996, 81: 400-410.

[11] Parasuraman, S., Purohit, Y.S. and Godshalk, V.M.. Work and family variables, entrepreneurial career success, and psychological well-being, Journal of Vocational Behavior 1996, 48: 275-300.

[12] Plantenga, J.and Hansen, J. Assessing equal opportunities in the European Union. International Labour Review 1999, 138 (4): 351-379.

[13] Pocock, B. Work-life â&#x20AC;&#x2DC;balanceâ&#x20AC;&#x2122; in Australia: limited progress, dim prospects. Asia Pacific Journal of Human Resources 2005, 43 (2): 198-209.

[14] Posig, M. and Kickul, J. Work-role expectations and work family conflict: gender differences in emotional exhaustion, Women in Management Review 2004, 19 (7): 373-86.

[15] Rothausen, T.J. Family in organizational research: a review and comparison of definitions and measures, Journal of Organizational Behavior 1999, 20: 817-36.

[16] Walker, E., Wang, C., Redmond, J. Women and work-life balance: is home-based business ownership the solution?. Equal Opportunities International 2008, 27 (3): 258-275.

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Improving impact of motivational methods for employees and consumers of light industry enterprises Jamshid Jalilov Ganijonovich1+ 1

Bukhara Engineering- Technological Institute, Uzbekistan

Abstract. Motivation has been of interest to researchers and academics, in management and other disciplines of economy, for some years, and published papers focus on definitions, the role of motivational methods in industrial enterprises, and various empirical investigations. The main goal of the paper is the discussion of motivation methods in light industry enterprises and consumers of production on light industry enterprises. Here, we analyze the impact of motivational methods in light industry, in conditions of economic modernization. Motivation methods analyze the impact of imposing employees of light industry enterprises and consumers. Recommendations of increasing the impact of motivation methods for employees and consumers are considered.

Key words: motivation, motivational methods, motivational method based on care.

JEL Codes: Đ&#x153;10, M30, L60.

1.

Introduction

Every industry enterprise has general resources that are material, financial and human. The most critical one is no doubt the human resource of an enterprise. They are the humans who can either accelerate the process of organizational development or can demolish the organizational progress. This is another fact that as human resource proves to be the nucleus of organizational resources, motivation is the central and vital component which is the key contributor in the job satisfaction of an employee.

Motivating employees has become one of the most significant and most demanding activities in any organization. Organizations invest in effectual strategies to get motivated workforce to compete on the market. Salary alone does not prove to be the vital motivator for everyone in an organization. Various factors motivate people differently depending upon the nature of an organization.

No organization can sustain without increased workersâ&#x20AC;&#x2122; motivation that is inevitable i n the current scenario of hyper-competition in the corporate world. Motivation is the willingness of employees to perform excellent work efficiently and this willingnes s only comes when they perceive that their effort would result in their need satisfaction.

1

Corresponding author: e-mail address: Jalilovjg@mail.ru.

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e-mail: editors@reaser.eu Employee’s motivation can only be attained by realizing that his/her individual needs or goals are aligned to the organizational goals or achievement. Organizations need to extract various internal and external motivators for its workers and production consumers so that they might increase their motivation in order to get long run success. If you want to motivate someone you have to find out what he or she wants and put that thing as a reward for him, as a result that person will be behaving in the desired way. However, finding what your employee and consumer want and then alignment of individual and organizational needs can be complex at some stages. Motivating workers to implement elevated performance work systems is one of the basic aims of management principles that a successful business can have.

Motivation, and its methods, means, mechanisms are studied in modern science – modern economy, management, marketing, psychology and sociology, as one of the main directions. Modern foreign scientists M.Albert, Grayson J., K. Dale Carnegie D., K. Killen, Max J., M.Meskon, F-L.ServanSchreiber, F.Hedouri2 in their scientific literature have produced scientific researches on the system of motivation, this methods and mechanisms convention events.

Uzbek scientists as Q.H. Abdurahmonov, F.W. Mamarasulov, D.N. Rakhimova, Z.R. Khudayberdiyeva3 also produce effective research work on individual areas of motivation methods in subjects of economics, management, marketing, psychology and sociology.

The experience of the world’s famous companies that achieved success, shows that modern systems and ways of motivation are organized with application of stimulation of such aspects as manufacture of goods necessary for a consumer taking into account the requirements of a society; research of the social and ecological consequences related to a consumer, satisfaction of requirements by means of supervision over the target market, manufacture of goods taking into account the study of behavioral models of consumers, competitors and partners in business, creative products in integration with consumers. So it is necessary to draw a conclusion that motivation meeting modern requirements, should stimulate first of all manufacture of goods and services considering the interests of consumers. Considering the above-stated, we consider, Motivation is a system for stimulating and promoting the achievement of organizational purposes, taking into account the interests of not only workers, but also consumers.

Scientists in industry management and marketing methods by studying the effect of motivating people, almost all the researchers did not explain that one group of internal method will be predominant. Uzbek scientists’ Zayniddinov Shermuhamedov, Murakaev methods influence on the part of the authorities to workers were divided into:  Economic methods.  Organizational and disposal methods.  Social and psychological methods.4

2

Meskon M. Albert M. Hedouri F. (1999). Principles of Management. M.: The Case of . K Grayson, D., K. O'Dell. (1991).

American management in the XXI century.- M .: Economy. Carnegie D. (1989). How to Win Friends and Influence People. - M .: Economy. G. Cole G.A. (1996), “Management: Theory and Practice” –5th edition. -London.:Aldine place.

3 Abdurakhmanov Q. , Mamarasulov F. (1996). Labour economy.- T.: TEU; Shodmonov Sh. Alimov R. Juraev T. (2002).

Theory economy.-T.: Finance; Rakhimova D. (2000). Management of development processes and the use of the labor potential of Uzbekistan in terms of the radical market reforms. - T .: TGTU. 4 Zayniddinov SH. Shermuhamedov A, Murakaev I. (2005). Management. textbook. Т.: Uzbekistan.

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e-mail: editors@reaser.eu Administrative influence on people in economic practice is a management method. Motivational methods are a complex of factors, means, key factors and stimulus promoting stimulation of separate persons or a group of persons to certain purposeful behavior. According to motivational purposes in management of workersâ&#x20AC;&#x2122; action goes on achievement of high results of work, qualitative, creative activity, intensity of work and other purposes. Motivation in marketing goes on stimulation of buyer to big and long purchases, preservation of its loyalty.

The organizational purposes makes it necessary to divide the methods of motivation, applied to bring changes in the actions of people under motivational influence, in two big groups: The first group of motivational methods is a complex of stimulating factors, means, key factors and stimulus promoting a better and effective work of enterprise personnel.

1. psychologically-creative 2. based on care 3.

behavioural

4. by participating in management 5. material 6. by personal and professional development (career) 7. administrative The 2nd-group methods of motivation is the complex of factors, means, key factors and the stimulus stimulating buyers to get more and with loyalty of goods on the enterprise. The organizations are completely dependent on world around - from an environment - both concerning the resources, and concerning consumers, users their results which they aspire to reach.

1.

2.

3.

4.

5.

6.

psychological and behavioural by organizing the commercial space (sales) by participating in management at decision-making material by personal and communication development administrative

Application of social interrogations at studying the degree of an effective utilization of motivation methods in light industry enterprises in Bukhara region, Uzbekistan. There is a set of techniques of the social researches applied at studying the efficiency of motivational methods at light industry enterprises.

The most widespread of them are: Rating scale. The rating scale is considered the most convenient way applied at an evaluation of problems of the various maintenance. Here it is required to designate thought or feeling on one indicator.

R.Laykerta's scale5. One of the most widespread techniques of measurement of the relation has been provided by Rensis Laykert in 1932. At this technique the relation of people are defined by means of certain opinions and estimations.

5

Likert, Rensis (1932). "A Technique for the Measurement of Attitudes". Archives of Psychology 140: 1â&#x20AC;&#x201C;55.

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e-mail: editors@reaser.eu Semantic segmentation on C.E.Oscood. This technique has been developed by C.E.Oscood and P.Tannenbaubi6. Here the antonyms separated from each other by seven levels are given, the respondent shows the attitude by means of signs. By means of semantic segmentation of respondents it is possible to distinguish and break into groups.

I.Krespi's scale. I.Krespi's scale represents the simplified kind of semantic segmentation, is applied when respondents have no enough data, or in interrogations by phone. The scale consists from positive and the negative numbers characterizing any property of the goods, the respondent expresses the relation, leading round comprehensible to it in a circle.

With a view of studying of efficiency of application of methods of motivation at industrial enterprises we had been made the questionnaire. The questionnaire has improved techniques of semantic segmentation the developed C.Osgood (Osgood C.) and P.Tannenbaubi (Tannenbaubi P.) . Here antonyms divided on 5 levels are given, participating in interrogation shows the attitude a sign. The level of answers to each question is designated from one to five. That is the respondent answering a certain question, if the given situation at the enterprise, where he works (or whose production consumes) is in very heavy position he marks "a = 1" if the situation in excellent position marks "e = 5". Answers received from simplification respondents, arithmetic-mean value which shows level of use of methods of motivation of each group is summarized, deduced.

The questionnaire for the individual persons was written on paper version. We had 800 respondents (400 respondents are workers, 400 respondents are consumers).

Table 1. The structure of questionnaire of motivational methods according to employees and consumers of light industrial enterprise.

Method of motivation Question

Points received a=1

b=2

c=3

d=4

e=5

Question 1 Question 2 Question 3 Question 4 Question 5 Question 6 Question 7 Question 8 Question 9 Question 10 Question 11 6

Oscood, C. E., G. J. Suci, and P. H. Tannenbaubi. (1957). The measurement of meaning. Urbana, Illinois, University of Illinois Press.

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e-mail: editors@reaser.eu Question 12 Question 13 Question 14 Question 15 Total

A= quen of “a”

B= quen of “b”

C= quen of “c”

D= quen of “d”

E= quen of “e”

At the same time we need to summarize all the results of the motivational methods.

Table 2. Efficiency methods of motivation on the light industrial enterprise Points received Motivation methods A= quen of “a”

B= quen of “b”

C= quen of “c”

D= quen of “d”

E= quen of “e”

Ave rage

1. Psychologically-creative (15 questions) 2. Based on care (15 questions) 3. Behavioural (15 questions) 4. By participating in management (12 questions) 5. Material (15 questions) 6. By personal and professional development (career) (15 questions) 7. Administrative (15 questions)

For computing the average impact motivational methods we have used the following formula: Average impact of motivational method = (A*1 + B*2 + C*3 + D*4 +E*5)/ ((number of questions)* (Number of respondent)) Further you will familiarize with results of evaluation of efficiency of motivational methods of applied to workers of the enterprise (the table - 3 and figure. 1). Results of the interrogation spent for the purpose of studying of methods of motivation at the light industry enterprises, functioning in Bukhara region, have led to following conclusions:  

almost all workers underlining the high importance of material method of motivation (5.7), assert, that the management of the enterprises in small degree is improved by these methods (2.64).

A psychologically-creative motivational method is estimated level of application of these method at the enterprises where they work as satisfactory (3.43); Table 3. Efficiency methods of motivation applied to the workers of the light industry enterprises

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e-mail: editors@reaser.eu Points received Motivation methods

Ave rage

A= quen of “a”

B= quen of “b”

C= quen of “c”

D= quen of “d”

E= quen of “e”

1. Psychologically-creative (15 questions)

610

750

1540

1650

1450

3.43

2. Based on care (15 questions)

1020

580

1270

1300

1830

3.39

3. Behavioral (15 questions)

490

570

1250

1720

1970

3.68

4. By participating in management (12 questions)

640

630

880

1490

1160

3,4

5. Material (15 questions)

1800

1290

1150

1070

690

2.64

6. By personal and professional development (career) (15 questions)

870

1070

1290

1370

1400

3.23

7. Administrative (15 questions)

540

980

1190

1230

2060

3.55

Fig 1: Results of definition of efficiency methods of motivation in interrogation means

 

according to workers, motivational method based on care the attention in that degree as which they consider normal (3.39) is paid; A behavioural method of motivation from results of interrogation it becomes obvious, that chiefs of the enterprises use these methods in wide to a measure, than it is necessary (3.68);

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e-mail: editors@reaser.eu 

they have estimated level of use an administrative method in the organization have given an appreciation of degree of use of these methods (3.55), however, according to workers, does not follow will pay excessive attention to use of these methods.

The problems of our researches also include studying of a condition of influence on consumers of an administrative motivational method. Therefore we had been spent interrogation by the technique set forth above and opinions, estimations and offers of consumers concerning this sphere are studied. On presented table 4 and figure 2.

The results of the interrogation displaying the relation of consumers of light industry production to motivational method, applied by the enterprises making this production, will lead to the following results having the scientific and practical importance: 

almost all consumers have highly appreciated improvement of methods by organizing the commercial space (sales) (3.27), however a primary part of consumers have noticed, that get these products not at the enterprise, and at wholesale or retail intermediaries. The conclusion from this follows, that the appreciation given to methods by organizing the commercial space (sales), concerns not manufacturers, and to intermediaries;

Table 4: Efficiency of methods of the motivation applied to consumers of production of the enterprise Motivational methods

Points received

A= quen of “a”

B= quen of “b”

C= quen of “c”

D= quen of “d”

780

840

2530

960

130

1040

2970

820

1040

3.27

3. By participating in management at decisionmaking (15 questions)

1680

1330

1990

550

450

2.46

4. Material (15 questions)

1660

1830

1610

560

340

2.35

5. By personal and communication development (15 questions)

1050

2110

1580

710

550

2.6

6. Administrative (15 questions)

690

1890

1710

950

760

2.87

1. Psychological and behavioral (15 questions) 2.by organizing the commercial space (sales) (15 questions)

E= quen of “e”

Aver age

890

3.06

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Fig 2: Results of definition of efficiency of motivational method by means of interrogation









consumers have stated a positive estimation also to psychological and behavioral method of motivation (3.06). The same as in a case with motivational method by organizing the commercial space (sales), these positive estimations concern manufacturers to a lesser degree; at the same time, it is necessary to note, the motivational method of personal and communication development has made upon consumers a positive impression (2.6). This certificate of the enterprises are in a course of events and have the full and detailed information therefore the steady effect of influence is reached. However consumers have estimated the importance of motivational method of personal and communication development much lower (2.5); influence on purchasing of consumers by an administrative method of motivation rather strong (2.87). One of the principal causes of high values of an indicator is the execution of requirements of the Law «About protection of the rights of the consumer», the second reason consists in making available the administrative obstacles established before consumers of some industrial enterprises. A main cause of the attraction of the motivational method of participating in management at decision-making gives small effect, consists that the enterprises of light industry functioning in the branch, have not established direct contacts to the consumers; efficiency of material method of motivation of consumers has been estimated below only (2.35).

Here the first and solving reason is that the enterprises give not enough attention to measures on attraction of consumers by a material method of motivation, on stimulation to big and more long purchases, besides, the basic part of not numerous developed measures on material stimulation is mastered by intermediaries.

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2.

Conclusion

The organization’s commitment to equal opportunity is important to create a sense of fairness among employees. Promotion through the ranks, rather than external appointments should be the preferred method of recruitment. Employees should be prepared for the next level through ongoing training and development and mentorship programs. Future expansion plans within the organization should be communicated to employees to prevent employees from being de-motivated by their lack of awareness of future opportunities. Employees should also be allowed to apply for positions that arise in related party ventures.

One way to encourage desired behavior is to recognize and praise those achievements that result from the behaviors that are desired. Research revealed that the need for achievement can successfully be promoted through adequate recognition and praise of employee achievements. Recognition and appreciation of achievements is an esteem need, according to Maslow’s hierarchy of needs. It is important that the organization ensures that recognition is fair and equitable. It needs to be remembered that that the perception of team members of what is regarded as fair treatment is based on the comparison they make on how they are treated relative to other team members. A standard recognition and praise process should be developed in the organization. Consistent application is vital to prevent a feeling of inequity.

Recognition can either be intrinsic or extrinsic. It is the responsibility of the managers and supervisors to be aware of what form of recognition is valued by the team members. Achievements could be classified into different categories based on the overall value add aspect attached to each achievement e.g. a letter from a SP to thank an employee for spectacular customer service, could be a “category one” achievement that is recognized by awarding a certificate. Reduction in a SP’s debtor’s days could be categorized as a “category two” achievement, that could be recognized via a profit-share reward or bonus related to the rand value saving resulting from such a reduction. It is important that all achievements are immediately recognized by seniors to ensure maximum employee satisfaction, while the feeling of achievement is still fresh in the mind of the employee. Achievements should also be recognized throughout the organization.

This could be achieved via a monthly or quarterly achievement awards ceremony where exceptional achievements and performances are recognized and individuals are presented with special awards that could be in the form of an “employee” of the month award.

The organization should consider appropriate programs for employee development which is important to unlock employee potential. The organization’s current study fund only allows for a total annual benefit of twelve thousand rand, which is distributed to employees on a first come first served basis. With the current staff compliment of close to one hundred and eighty, this is extremely inadequate and the organization should possibly consider increasing the total benefit of the study fund and encourage more employees to study to further their careers and enhance their skills and abilities. The benefits of developing individuals, in order to work smarter rather than harder, far outweigh the costs of training and development. Enhancing employees’ skills will greatly enhance the employees’ expectation that their effort will lead to desirable performance. This is an important element of the Porter and Lawler model of motivation. Effort cannot lead to performance if the skills and ability to transfer input into valuable output is absent. To enhance on-the-job training, the organization also needs to consider the appointment of a

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e-mail: editors@reaser.eu dedicated full time training officer. It is vital that employees should be continuously developed in all areas of their jobs. Employees should be monitored to identify areas where improvement is required and appropriate training should be introduced to enhance their abilities, which will also enhance the possibility of future advancement within the organization. Employees also need to attend more SETA training seminars. HR should determine which SETA seminars are suitable and ensure employees attend these seminars as often as possible. These seminars could also be attended by the training officer who in turn could include material from SETA seminars in future in-house training. Appropriate learner-ship programs should also be considered. The training officer can also be responsible for creating e-training.

This could consist of exercises, aimed at enhancing skills, which employees can complete on the organization’s intranet. Employee scores can be made available to the rest of the organization and it could be promoted as an internal competition. A job rotation program, which involves moving employees from one job to another, should also be considered. The advantages related to job rotation include increased worker flexibility and easier scheduling due to the fact that employees are cross-trained to perform different jobs within the organization. This will also ensure that employees gain a broader perspective of the organization. Employees should also be engaged to establish their training needs. Employees use a variety of computer software programs. Their abilities should be measured and training should be provided if required. This will not only enhance the skills of the employee, but could enhance the quality of their work and could improve productivity if they are trained to use these software packages more effectively.

From the relation of the personnel of the enterprise and consumers to the methods of motivation applied by the enterprises of food-processing industry, defined by means of sociological interrogation, it is possible to draw the following general conclusion: almost all industrial enterprises have improved the measures, the systems of motivation directed simplification in the enterprise, however external motivation, that is measures on stimulation of consumers to the big and long purchases, is improved insufficiently.

Perspective. We believe that this is an emerging research topic that will gain more interest for workers of light industry enterprises and its production’s consumers.

3.

References

[1] Meskon M., Albert M. Hedouri F.(1999). Principles of Management. Moscow.: The Case of.

[2] Grayson, K. D., O'Dell, K..(1991). American management in the XXI century.- Moscow .: Economy.

[3] Carnegie D.(1989). How to Win Friends and Influence People. Moscow.

[4] Abdurakhmanov Q. , Mamarasulov F. (1996). Labour economy.- Tashkent.: TEU. [5] Shodmonov Sh., Alimov R. and Juraev T. (2002).Theory economy.- Tashkent.: Finance.

[6] Rakhimova D. (2000). Management of development processes and the use of the labor potential of Uzbekistan in terms of the radical market reforms. - Tashkent .: TGTU. [7] Zayniddinov SH. Shermuhamedov A, Murakaev I.(2005). Management, textbook. Тashkent.: Uzbekistan.

[8] Cole G.A. (1996), “Management: Theory and Practice” –5th edition. -London.:Aldine place.

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e-mail: editors@reaser.eu [9] Sharifxujayev M., Abdullayev YO. (2001), Management. Textbook. Тashkent. Uzbekistan.

[10] Jalilov J. (2009), Importance of tax policy in management of industrial enterprises by economic methods, Proceedings of Republican scientific-practical conference “To prevent the negative influence of the world financial – economic crises on Uzbekistan economy and the role of tax policy in stable growth of economy and encouraging the activity of entrepreneurship”. Tashkent. pp. 24 - 25.

[11] Jalilov J. (2011), Methods of motivation of industrial enterprises, The society and management journal.

Scientific – political, sociable – economic, spiritual – historical journal. Тashkent. 3 - number.pp.124-126.

[12] Jalilov J. (2011), Components of motivation of human: methods of motivation, Economy and education.

Scientific journal. -Tashkent. #6. pp.8-10.

[13] Jalilov J. (2013), The opportunities of using motivation methods in the economic development of industrial enterprises, Collection of theses of International scientific-practical conference “Development of tourism infrastructure and increase of a role of ecotourism in the conditions modernization of economy.” Tashkent. pp.

110 – 112.

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Inequality, socio-economic status, economic indicators, and student achievement John J. McCreary1+, Julianne M. Edwards2++, and Gregory J. Marchant3+++ 1,2,3

Ball State University

Abstract. HLM model fit was used to determine the relationship of the country level economic variables of GDP and the GINI Index to 2012 student PISA reading, math, and science achievement, along with individual SES, country SES mean, and country SES inequality. For all achievement areas the complete model of all variables represented the best fit. The significant predictors in the models were country SES inequality and student SES. This suggested a less direct relationship to achievement for the economic indicators of GDP and GINI, and demonstrated the significance of SES inequality related to student achievement.

Keywords: economic inequality, socio-economic status, student achievement, international JEL Codes: I24

1.

Introduction

The relationship between economics and education could be considered reciprocal. In general, the better the economics, the higher the student achievement; and the better education level, the better the economic condition. When it comes to student achievement, money matters.

The relationship between the Socio-Economic Status (SES) and academic achievement of a student is well established (Duncan & Brooks-Gunn, 2000). Money may not only buy happiness, it can also give a pretty good leg up on a decent education. It is not surprising that poorer countries do not do as well academically as wealthier ones (OECD, 2010). Simply put, richer countries have more money for schools and other resources that can promote learning. Students score higher on tests of achievement when they have more resources available, whether resources are measured at the country, school, or individual level (Chiu & Khoo, 2005). The effects of poverty on academic achievement have been noted in the United States (Battle, 2002; Chervin et al., 2003), Portugal (Bastos, Fernandes, & Passos, 2009), Africa (Appiah & McMahon, 2002), +

PhD candidate in educational psychology PhD candidate in educational psychology +++ PhD, Professor of educational psychology, Department of Educational Psychology, Teachers College Ball State University, Muncie, IN 47306, (765) 285-850, corresponding author, e-mail address: gmarchant@bsu.edu. ++

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Brazil (da Cunha, Andrea Jimenez, Rus Perez, & de Andrade, 2009), as well as in other countries around the world (Chiu, 2007). Some studies give evidence that the socioeconomic status of a student is more predictive of academic achievement than family configuration (Battle, 2002), or race (Battle & Pastrana, 2007). Some show an effect of immigrant status above and beyond SES (Greene, Hynes, & Doyle, 2011), although others suggest that these factors, along with low income and education level, and material deprivation, comprise low family socioeconomic status (Huston & Bentley, 2010). What is unclear is why some developed countries with higher overall SES, such as the United States, have poorer overall academic performance than some less developed countries, such as the case of Singapore, Thailand (Marchant & Finch, 2014).

Although in education SES, wealth, and poverty are considered for their influence on student achievement, in economic circles education is considered a driver for financial success (Appiah & McMahon, 2002; Baldwin & Borrelli, 2008; Bornschier, Herkenrath, & Konig, 2005; Jamison, Jamison, & Hanushek, 2007) and economic, political, and social stability (Kim, 1996; Thyne, 2006). For instance, the positive effects of education on economic growth include the adoption of new technologies (Lin, 1991), health literacy (Kickbusch, 2001), higher wage levels (Hill, 2001), and better human capital in industry (Tsai, Hung, & Harriott, 2010).

Caldas and Bankston (1997) offer peer family social status as a possible explanation for some of this. They found that students whose classmates were of higher SES performed better academically, likely because schools with more high-SES students typically have more resources available to students than those that do not (Chiu & Khoo, 2005). This begins to explain the effect of a country’s level of income inequality on students’ academic achievement. A likely source of the difference in student achievement in countries, irrespective of SES, is the degree to which income equality is a factor in that country. Though there is a dearth of research directly tying the two together, there are studies showing a greater effect of economic instability on a nation’s poor than on that nation’s higher SES constituents (Elliott, 2013). In spite of study findings to the contrary showing that family and demographic characteristics and income inequality of students within a school explain a large portion of the effect (Beck & Muschkin, 2012; Caldas & Bankston, 1997) and those suggesting that much of the race gap in achievement remains unexplained (Beck & Muschkin, 2012; Dixon-Roman, Everson, & McArdle, 2013), inequality has been shown to have an effect in other regards. In terms of physical health of individuals, countries with greater inequality have poorer health and shorter life expectancy (De Vogli, Mistry, Gnesotto & Cornia, 2005; Kondo, Sembajwe, Kawachi & van Dam, 2009), including higher rates of infant mortality (Hales, Howden-Chapman, Salmond, Woodward, & Mackenbach, 1999). Countries with high income inequality also experience more violence (Poveda, 2011; Shihadeh & Steffensmeier, 1994), including homicides (Kawachi, Kennedy & Wilson, 1999) and higher incidence of bullying (Due et al., 2009). Mental health also decreases with income inequality (Black & Krishnakumar, 1998). Higher rates of depression in women (Pabayo, R., Kawachi, I., & Gilman, S.E., 2013), incidences of schizophrenia (Burns, Tomita, Kapadia, 2013), and increase in drug-related deaths (Najman, Toloo, & Williams, 2008). Further, although there may be a lack of research directly correlating income inequality and academic achievement, there is quite a bit of research tying the aforementioned effects of inequality to problems in academic

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achievement (Attar, Guerra, & Tolan, 1994; Black & Krishnakumar, 1998; Margolin & Gordis, 2000; Rutter, 1981).

The current study looks at the relationship of economic indicators, measures of SES, and inequality to student achievement.

2.

2.1.

Method PISA

Of the 71 countries in the 2012 Programme for International Student Assessment (PISA) database, 54 countries had complete data including the two additional economic indicators of GDP and GINI. The countries included in the analyses were: Albania, Argentina, Australia, Austria, Belgium, Brazil, Bulgaria, Canada, Chile, Colombia, Croatia, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hong Kong-China, Hungary, Indonesia, Ireland, Israel, Italy, Japan, Jordan, Kazakhstan, Korea, Latvia, Lithuania, Luxembourg, Mexico, Montenegro, Netherlands, New Zealand, Norway, Peru, Poland, Portugal, Qatar, Romania, Russian Federation, Serbia, Singapore, Slovak Republic, Slovenia, Spain, Sweden, Switzerland, Thailand, Tunisia, Turkey, United Kingdom, United States of America, and Uruguay In addition to achievement scores for reading, math, and science, the PISA SES Index was used in three ways. The PISA SES index is derived from a factor analysis of variables that include parent education and occupation, and possessions in the home (mean = 0, standard deviation = 1). The individual student’s SES Index was used, as well as the country SES mean for the students. The standard deviation for each country’s SES was included as a measure of SES inequality related to the distribution of SES. 2.2.

Economic Indicators

Gross Domestic Product (GDP) is defined by the Worldbank as “the sum of gross value added by all resident producers in the economy plus any taxes and minus any subsidies not included in the value of products.”

GINI index, according to the World Bank website, is a measure of how unequally income or consumption expenditure is distributed among households/individuals.

3.

Analyses

Three Hierarchical Linear Model (HLM) analyses were conducted to determine the model that best predicts achievement on each 2012 PISA subtests (i.e., mathematics, reading, and science). HLM is a statistical tool that is similar to regression, as it predicts the outcome of dependent variables from one or more predictors. The defining difference between HLM and regression is that HLM can account for multilevel data (e.g., student and school), which eliminates the violation of independence when multilevel data is used in a regression analysis. An HLM analysis was used, as both individual level student data and country level data were included. The three HLM models used to predict PISA achievement included 1) PISA achievement predicted from country GDP and country GINI, 2) PISA achievement predicted

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from country GDP, country GINI, country SES (mean SES), and country SES inequality (SES standard deviation), and 3) PISA achievement predicted from student individual SES, country GDP, country GINI, country SES, and country SES inequality.

4.

4.1.

Results Mathematics

In Model 1 for mathematics, both GDP and GINI were significant predictors of mathematic achievement (see Table 1). However, Model 2 suggested that the impact GDP and GINI had on mathematic achievement was mediated by country SES inequality. This was indicated by GDP and GINI no longer being significant predictors of achievement when country SES inequality was included in the model. While the first two HLM models provide information about mathematics achievement, model 3 was the model that best fit the data, as it had the lowest AIC and BIC. Thus, model 3 will be explained in further detail.

Model 3 predicted mathematic achievement from student SES, GDP, GINI, country mean SES, and country SES inequality. Consistent with Model 2, GDP and GINI were no longer significant predictors of math achievement, again suggesting that country SES inequality mediated the impact of GDP and GINI. Further, this model showed that student SES and country SES inequality were significant predictors of mathematic success. The results suggested that country SES inequality was the strongest predictor of mathematic achievement, indicated by a higher coefficient (see Table 1), and scores would be most related to this variable. Specifically, as country SES inequality increased by 1 standard deviation, mathematic scores decreased by 138.97 points. The second most important predictor of mathematic achievement was the student individual SES. Unlike country SES inequality, student SES had a positive impact on mathematic achievement. That is, as student SES increases by one standard deviation, the studentâ&#x20AC;&#x2122;s mathematics score increased by 30.31 points.

4.2.

Reading

The results for reading were similar to the results for mathematics. Model 1 for reading showed that GDP and GINI were significant predictors of reading achievement (see Table 1).

However, as Model 2 incorporated country mean SES and country SES inequality, GDP and GINI were no longer significant predictors. Due to country SES inequality being the only significant predictor in Model 2, this suggested that country SES inequality mediated the relationship between reading achievement and the Model 1 predictor variables. Similar to the results of mathematics, Model 3 for reading fit the data the best, with this model having the lowest AIC and BIC compared to Models 1 and 2. As a result, model 3 will be discussed further.

Model 3 was used to predict reading achievement from student SES, GDP, GINI, country mean SES, and country SES inequality. Similar to Model 2, GDP and GINI were not significant predictors of reading achievement in Model 3. Again, due to country SES inequality being a significant predictor of reading scores this suggested that country SES inequality mediated the relationship between the Model 1 predictors and reading achievement. Within Model 3 there were

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two significant predictors in Model 3: country SES inequality, and individual student SES. Country SES inequality was the strongest predictor of reading achievement, as the predictor had the highest coefficient (see Table 1). The results for country SES inequality show that as this predictor increased by one standard deviation, reading scores decreased by 104.15 points. Student SES was the second most important predictor of reading achievement. Specially, the results suggest that when student individual SES increased by one standard deviation, reading score increases of 29.1.

4.3.

Science

Science achievement also showed similar results to those found in mathematic and reading achievement. Model 1 showed that GDP and GINI were significant predictors of science (see Table 1). However, when Model 2 entered country SES mean and country SES inequality, the Model 1 predictors were no longer significant. The significance of country SES inequality suggested that it mediated the relationship between the Model 1 predictors (GDP and GINI) and science achievement. The final model, Model 3, best fit the data and had the lowest AIC and BIC. Model 3 predicted science achievement from student SES, GDP, GINI, country mean SES, and country SES inequality. Consistent with Model 2, both GDP and GINI were no longer significant predictors, whereas country SES inequality was a significant predictor. This suggested that country SES inequality mediated the relationship between the Model 1 predictors and science achievement. Additionally, country SES was the strongest predictor of science achievement, as it has the highest coefficient. The results suggest that as country SES inequality increased by one standard deviation, science achievement decreased by 132.31 points. The only other significant predictor of science achievement was student level SES. The results indicated that as student SES increased by one standard deviation, science achievement increases by 28.78.

5.

Discussion

As previously noted, the relationship between economics and education is considered reciprocal, and HLM is a correlational approach. This suggests that without strong theory or extraordinary circumstances, causal interpretations are inappropriate. This means that poor achievement may be resulting in higher country SES inequality, rather than country SES inequality leading to lower achievement.

Although lower SES students do better in wealthier countries than in poorer countries, a nationâ&#x20AC;&#x2122;s wealth seems to most benefit the educational achievement of the wealthy (Marchant & Finch, 2014). This exacerbates inequality in education and SES. This was reflected in the strength of country SES inequality as a predictor of achievement (over three times stronger than the studentâ&#x20AC;&#x2122;s own SES for math and science).

Country GDP and GINI may be too removed from the student situation to have a strong direct relationship to student achievement. Researchers using these variables are likely to underestimate economic and inequality factors on student achievement. GDP did a better job of reflecting overall parent SES than GINI did at reflecting the economic inequality faced by students. Although country economic indicators are not the same thing as family SES, looking at

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the nature of SES of the collective parents of a country is a much more viable measure of economics related to student achievement. It also allows for consistent comparisons across levels rather than the lack of congruency of internal and external measures of income or SES (Chudgar & Luschei, 2009)

6.

References

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[11] Chervin, R. D., Clarke, D. F., Huffman, J. L., Szymanski, E., Ruzicka, D. L., Miller, V., . . . Giordani, B. J. (2003). School performance, race, and other correlates of sleep-disordered breathing in children.

Sleep Medicine, 4(1), 21-27. doi: 10.1016/s1389-9457(02)00243-5

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[12] Chiu, M. M. (2007). Families, economies, cultures, and science achievement in 41 countries: Country-, school-, and student-level analyses. Journal of Family Psychology, 21(3), 510-519. doi: 10.1037/08933200.21.3.510 [13] Chiu, M. M., & Khoo, L. (2005). Effects of resources, inequality, and privilege bias on achievement: Country, school, and student level analyses. American Educational Research Journal, 42(4), 575-603. doi: 10.3102/00028312042004575 [14] Chudgar, A., & Luschei, T. F. (2009). National income, income inequality, and the importance of schools: A hierarchical cross-national comparison. American Educational Research Journal, 46, 626658. DOI: 10.3102/0002831209340043 [15] da Cunha, J. M. P., Andrea Jimenez, M., Rus Perez, J. R., & de Andrade, C. Y. (2009). Social segregation and academic achievement in state-run elementary schools in the municipality of Campinas, Brazil. Geoforum, 40(5), 873-883. doi: 10.1016/j.geoforum.2009.06.003 [16] Dixon-Roman, E. J., Everson, H. T., & McArdle, J. J. (2013). Race, Poverty and SAT Scores: Modeling the Influences of Family Income on Black and White High School Students' SAT Performance. Teachers College Record, 115(4).

[17] Elliott, W. (2013). The effects of economic instability on children's educational outcomes. Children and Youth Services Review, 35(3), 461-471. doi: 10.1016/j.childyouth.2012.12.017 [18] Greene, K. M., Hynes, K., & Doyle, E. A. (2011). Self-care among school-aged children of immigrants.

Children and Youth Services Review, 33(5), 783-789. doi: 10.1016/j.childyouth.2010.11.023 [19] Hill, E. T. (2001). Post-school-age training among women: Training methods and labor market outcomes at older ages. Economics of Education Review, 20(2), 181-191. doi: 10.1016/s02727757(99)00059-x [20] Huston, A. C., & Bentley, A. C. (2010). Human Development in Societal Context Annual Review of Psychology (Vol. 61, pp. 411-437).

[21] Jamison, E. A., Jamison, D. T., & Hanushek, E. A. (2007). The effects of education quality on income growth and mortality decline. Economics of Education Review, 26(6), 771-788. doi: 10.1016/j.econedurev.2007.07.001 [22] Kickbusch, I. S. (2001). Health literacy: Addressing the health and education divide. Health Promotion International, 16(3), 289-297. doi: 10.1093/heapro/16.3.289 [23] Kim, W. (1996). Problems and remedies of the North Korean economy: A strategic approach. Korean Journal of Defense Analysis, 8(2), 223-&.

[24] Lin, J. Y. (1991). Education and innovation adoption in agriculture - Evidence from hybrid rice in China. American Journal of Agricultural Economics, 73(3), 713-721. doi: 10.2307/1242823 [25] Marchant, G. J., & Finch, W. H. (2014). Does a rising tide lift all boats? International relative and absolute SES and achievement. Paper presented at the American Educational Research Association, Philadelphia, PA.

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[26] Margolin, G., & Gordis, E. B. (2000). The effects of family and community violence on children.

Annual Review of Psychology, 51, 445-479. doi: 10.1146/annurev.psych.51.1.445 [27] Rutter, M. (1981). The city and the child. The American journal of orthopsychiatry, 51(4), 610-625.

[28] Thyne, C. L. (2006). ABC's, 123's, and the Golden Rule: The pacifying effect of education on Civil War, 1980-1999. International Studies Quarterly, 50(4), 733-754. doi: 10.1111/j.14682478.2006.00423.x [29] Tsai, C.-L., Hung, M.-C., & Harriott, K. (2010). Human capital composition and economic growth.

Social Indicators Research, 99(1), 41-59. doi: 10.1007/s11205-009-9565-z [30] Van Ewijk, R., & Sleegers, P. (2010). The effect of peer socioeconomic status on student achievement: A meta-analysis. Educational Research Review, 5(2), 134-150.

[31] Wilkinson, R. G., & Pickett, K. E. (2007). The problems of relative deprivation: Why some societies do better than others. Social Science & Medicine, 65(9), 1965-1978.

Yen, H. (2012, July 22). US poverty on track to rise to highest since 1960s. Associated Press. Retrieved from http://hosted.ap.org/dynamic/stories/U/US_POVERTY_IN_AMERICA

Table 1. HLM Results for All PISA Subtests

Mathematics Predictors

Reading

Science

Coef.

SE

T-ratio

Coef.

SE

T-ratio

Coef.

SE

T-ratio

GDP

2.56

.001

2025.7**

2.44

.001

1890.88**

2.69

.001

2141.80**

GINI

-2.41

.002

-1013.9**

-1.75

.002

-724.815**

-2.01

.002

-853.50**

GDP

.27

44.11

.845

.18

.24

.783

.22

.26

.87

GINI

.37

.31

.470

.82

.63

1.30

.56

.68

.83

28.67

.79

1.15

41.81

21.29

1.96

36.28

23.14

1.57

-146.29

24.9

-3.32*

-108.69

36.42

-2.98*

134.55

37.05

-3.63*

SES

30.31

.02

1812.17**

29.10

.02

1664.95**

28.78

.02

1720.81**

GDP

.22

.31

.724

.16

.23

.70

.21

.25

.84

GINI

.42

.78

.538

.84

.62

1.36

.57

.66

.86

.98

24.7

.040

14.49

21.05

.68

8.75

22.84

.38

-138.97

.02

-3.19**

-104.15

36.05

-2.89*

132.31

36.04

-3.67*

Model 1

Model 2

SES Mean SES SD Model 3

SES Mean SES SD

Note. * < .05, ** < .01

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The social construction of Roma housing issue: determinants of Roma and Romanians perceptions Catalina-Ionela Rezeanu 1  1

University of Bucharest, Romania

Abstract. International Competition: The Best Scientific Article of the Young Researchers. At the international level, there is a rapidly growing literature on the poor quality of Roma housing in order to formulate and implement better policies addressing this issue. On the one hand, empirical studies tend to focus predominantly on European or national level, ignoring the particularities of different local Roma communities; and on the other hand, most of these studies are concerned only with Roma perspective of the situation, not taking into account that the problem is a socially constructed one, implying conflict and negotiations between Roma and other ethnic groups perspectives. The premise of the paper is that, in Romania, general European housing polices for Roma population could be implemented better in taking into account local specificities, and accepting that the issue is a social construct between Roma auto-perception and Romanians perceptions about Roma. In this paper, we conducted a secondary analysis of data based on "The Barometer Survey on Roma in Fagaras" held in February 2013. Quantitative data were collected through the oral survey technique based on standardized questionnaire, applied to four Roma communities living in the peripheral areas of Fagaras City (systematic sample, N = 400 Roma respondents aged 18 years and over) and to the central and middle city neighborhoods, majority inhabited by Romanians (systematic sample, N = 400 Romanian respondents aged 18 years and over). We asked the question what variables are the determinants of Roma and Romanians perceptions about Roma housing issue. Applying OLS regression analysis, the data provided evidence that Roma respondents perceive that the issue of Roma housing is important and therefore should be included in public authorities’ agenda when they: 1) acknowledge the lack of housing utilities and amenities and reject the need for some of them, 2) think a particular solution would bring them concrete advantages, 3) internalize social stigma and express the need to reduce their residential segregation; Romanian respondents perceive that the issue of Roma housing issue is important, and therefore should be included in public authorities’ agenda when they acknowledge: 1) the specific problems of two local Roma communities, 2) the wage dependency of the entire local Roma community and 3) the labor discrimination against Roma and the need to reduce Roma residential segregation.

Keywords: housing, ethnic minority, wage dependency, labour discrimination, access to basic utilities, JEL Codes: 018, J15, E24, J71, I38 1.

Introduction

In The Decade of Roma Inclusion 2005-2015, the housing issue was identified as one of the most pressing concerns regarding Roma population [1]. Additionally, recent sociological literature on Roma housing has been pointing to problems such as: lack of house accessibility and affordability, insecurity of 

PhD student, winner of the competition The Best Scientific Article of Young Researchers. Tel.: + 40727676895, e-mail address: rezeanucatalina@gmail.com.

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house tenure, substandard housing conditions, overcrowding, and segregation [2]. Even if the characteristics and the magnitude of these problems are known, policies to address them do not seem to make substantial progress. Also, in the last decade research about Roma housing issue has been conducted in different countries like: Italy [3], [4], Serbia [5], Finland and England [6], Spain [7], Hungary [8], Bulgaria [9], and Romania [10]. Most of these studies are general ones, and present the Roma housing issue at the European Union, national or regional level.

With regard to Romanian national context, the research published in 2012 by European Union Agency for Fundamental Rights [11] showed that almost 8 of 10 Roma houses did not have: piped water inside (78%), toilet inside (82%), shower or bathroom inside (85%), and connection to the sewage system or waste water tank (80%). One quarter of Roma respondents described their residence as being a ruined house or slum. On average, more than 2.5 persons lived in one room. 23% of Roma declared that they live in an area which is segregated from the rest of the settlement, for 20% the reason for moving to their neighbourhood being eviction or relocation, and for 21% finding better housing. More than a quarter of Roma experienced discrimination because of their Roma background in the past year, and 34% experienced discrimination when looking for a house or apartment to rent or buy. 72% of Roma declared that their housing situation had not improved in the last 5 years. According to another research about Roma from Romania published in 2009 [12], 42% of Roma did not have security of house tenure (because they or someone close to not own the house in which they live). Therefore, the available evidence seems to suggest that at Romanian national level the Roma housing issue is a serious one, and needs efficient social policies to be addressed.

However, a recent study [13] applied to four Eastern European countries (Bulgaria, Hungary, Lithuania, and Slovakia) showed that national initiatives to solve Roma housing issues, according to the European Union directives, failed, and resulted in increasing Roma residential segregation. This situation happened because of the government applying top-down measures, ignoring the local needs and other contextual factors, and not evaluating periodically the program implementation effects. Along similar lines, [14] argues that the tradition of studying Roma minorities as a homogenous population with a similar identity did not provide a proper answer to the questions about who Roma is and ignored the diversity and complexity of local Roma communities. In this regard, in Romanian context, studies about Roma housing issues have been conducted on specific regional or local Roma communities [15], [16], [17], [18], [19].

Given the centrality of the issue of Roma diversity, in this paper we will focus on studying the particularities of four Roma communities situated on the periphery of Făgăraș City (Plopului Street, Negoiu Street, Combinat Colony, and Prunului Street), in order to contribute to the understanding of local specificities of Roma housing issue. Choosing these communities was based on the fact that the first three communities live in substandard social houses, while in the last community the majority of Roma live in illegally constructed houses or other forms of improvised shelters. We previously found that Roma and Romanians have a similar perception about the severity of Roma housing issue, but a different perception about the solutions proposed to solve the problem. This could mean that apparent similarities might hide different mechanism and arguments of crystallizing this perceptions, and also different levels of accepting the solutions proposed by local authorities. That’s why in this paper we ask the question what variables are the determinants of Roma and Romanians perceptions about the importance of Roma housing issue, the main hypothesis being that the determinants might not be the same for Roma and Romanians perceptions. Not only that this research could make a step further towards a more profound understanding of the mechanism of decisions about the entrance of an issue of an ethnic minority group in the local communities’ agenda, but also could make a contribution in helping local authorities formulate the public agenda without ignoring the specific determinants of different ethnic groups’ perceptions.

1.1.

Theoretical framework

In the present paper, we put forward the claim that residential space is both socially produced and socially constructed. According to the relational model of space, developed recently by Marthina Low, the

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social construction of space is defined as the “transformation of space – through people’ social exchanges, memories, images and daily use of the material settings – into scenes and actions that convey meaning”; and the social production of space “includes all those factors – social, economic, ideological, and technological – that result, or seek to result, in the physical creation of the material setting” [20]. On the one hand, the literature offers examples of studies that focus on understanding the providing of houses for Roma as a process of social production of residential space in which space can contribute to stigma and exclusion [21].

On the other hand, there is an increasing literature pointing to the need of studying more how public discourse is taken up by Roma, reinterpreted and lived in their everyday life [14]. In this regard [22] propounded the assumption that there are differences between how Roma represent themselves and how are represented by others, and introduced the distinction between ”representation of Roma” (the social construction of Roma identity, the way they are seen and understood by others) and ”representation for Roma” (their ability to make themselves understood and seen, to control the dominant images of themselves). Starting from these theoretical grounds, the present paper based on secondary analysis of data, becomes an answer to the need to study Roma issues as socially constructed ones, taking into account both Roma and Romanians perspectives. The originality of this paper resides in applying recent conceptual frameworks from the field of space studies and Roma studies to study local particularities of four Roma communities from Făgăraș City, assuming that Roma housing issue is a social construct based on local specificities and on different mental constructions of minority (Roma) and majority (Romanians) ethnic groups.

2.

Method

This study is a secondary analysis based on data collected in February 2013 for the local study “The Barometer Survey on Roma in Făgăraș City”, in which I participated as a member of the research team by developing methodological research design and the research report.

2.1.

Data collection

Quantitative data were collected through the oral survey technique based on standardized questionnaire, applied to four peripheral areas of Făgăraș City, where Roma communities face severe housing problems (systematic sample, N = 400 Roma respondents aged 18 years and over) and to the central and middle city neighbourhoods, majority inhabited by Romanians (systematic sample, N = 400 Romanian respondents aged 18 years and over). The collected data were centralized using IBM SPSS Statistics, Version 20.

The four Roma communities in which study was conducted are: Prunului Street form Galați district (located in the north periphery of the city, a big number of Roma living in substandard houses illegally built), Combinat Colony (located in the south industrial periphery of the city, the majority of Roma living in social houses), Negoiu number 1 block of flats (located in the east periphery of the city, Roma still living in a dilapidated social houses after refusing to move to Plopului Street), and Plopului Street number 3, 6, and 12 block of flats (located in the west periphery of the city, Roma living in social houses after they were moved from Negoiu number 2, 5, and 8 block of flats). The identification of potential Roma respondents was done using the technique of implicit validation, which is recognized in the literature as being a little more efficient then the direct self-identification [23]. More exactly, the potential Roma respondent was approached by the interviewer with the phrase “we are conducting a survey among the Roma population’, acceptance to participate in the study being interpreted as the respondent being Roma.

2.2.

Measurements and statistical analyses

In the original study four concepts were measured: respondent socio-demographic profile; perceptions about Roma housing issues; perceptions about solutions to solve Roma housing issues; perceptions about the relationship between Roma and Romanians. The secondary analysis of data started from two dummy dependent variables regarding Romanians (DV1) and Roma perception (DV2) about whether the issue of Roma housing conditions is important or not (and therefore should be included in public authorities’

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agenda). All the other potential independent variables from the database were either dummy variables, or continuous quantitative ones (detailed information about the measurements of the variables used in the study are presented in Table 1 from the Appendix. In order to identify the independent variables to be included in the regression model, first, we conducted Pearson correlation analysis, and selected only those variables which correlated significantly (Sig. < .05) with DV1, respectively DV2. Second, for every variable selected we tested a simple OLS (Ordinary Least Squares) regression model, and selected only those variables included in a statistical significant regression model. Third, we included the selected variables in two OLS multiple regression models (one for DV1 and one for DV2), eliminating variables until the models and the B coefficients were all statistically significant. Before performing any of these steps, we verified for every variable used the meeting of the Pearson correlation and the linear regression assumptions. Therefore, although the database included a much larger number of variables, in the operational scheme, presented in Table 1 from the Appendix, were included only variables identified as predictors (IV) in statistically significant linear regression models. The two multiple regression models are the optimized ones, as they were built by introducing only those variables whose coefficients were found to be statistically significant and to meet the conditions of regression application.

3.

Results

This study is a secondary analysis based on data collected in February 2013 for the local study “The Barometer Survey on Roma in Făgăraș City”, in which I participated as a member of the research team by developing methodological research design and the research report For DV1, 29 linear simple regression models were statistically significant, showing that Romanians perception about whether the Roma housing conditions are important or not (and therefore should be included in public authorities’ agenda) can be modelled as functions of the sex of the respondent and of different dimensions of Romanians perception about the local Roma communities (see Table 2 from the Appendix): - the Roma main source of income (not salary or independent activities, but child / maternal allowance or social welfare) - a specific type of problem associated for every of the four analysed local Roma communities (not economic struggle, but housing issues or enforcement of low and order); in the category of economic struggle were included answers like: lack of jobs for Roma, low living standards for Roma, Roma poverty; in the category of housing issues were included answers like: lack of social houses, non tabulated houses, lack of sanitation services, lack of space inside de house, the need for Roma to be moved somewhere else, the need for renovating social houses in which Roma live, the danger of the housing buildings tearing down; in the category of enforcement of low and order were included answers like: lack of identity papers, lack of order, lack of tougher laws regarding Roma, lack of public order and safety in Roma communities - evaluating housing conditions as poor and very poor in a specific local Roma community (Combinat Colony) - knowing the fact that Roma lack access to basic infrastructure and house utilities in a specific local Roma community (Negoiu Street) - estimating that in a year housing conditions from every of the four analysed Roma communities will worsen - identifying a specific type of housing tenure associated for every of the four analysed local Roma communities (not owning the house; paying rent based on social housing contract; not paying rent, staying illegally in a social house; not having ID, impossible to make legal papers for land house tabulation; not having residence papers for some members of the household) - appreciating that for two of the local Roma communities analyzed (Prunului Street and Plopului Street) City Hall should not primarily solve the housing issue - supporting the solution of moving Roma population from a specific community (Negoiu Street) in a different place of the city - perceiving the existence of discrimination of local Roma communities

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admitting the idea that is more difficult for Roma than for Romanians to find a job being in favour on the idea of Roma and Romanians living in the same neighbourhood having positive perceptions about Roma (knowing examples of Roma and Romanians from local community helping each other in work; thinking Romanians should help Roma to integrate in society; rejecting the idea that most of Roma children are beggars and pocket stealers) - thinking that the State should help Roma more.

The linear multiple regression model for DV1 (F (314) = 10.282, Sig. = .00 < .05) shows that 23.3% of the variation of the DV1 could be predicted by the following 9 independent variables (ordered by their prediction power from the strongest to the weakest): 1) perceiving that the main type of problems of Roma from Combinat Colony is related to the lack of enforcement of low and order (IV8: in this category were included problems like lack of identity papers, order, tougher laws regarding Roma, public order and safety) 2) perceiving that the main source of income in Roma local communities is not the salary (IV2) 3) perceiving that the main source of income in Roma local communities is the social welfare (IV5) 4) perceiving that in Roma community from Combinat Colony there is a housing tenure issue related to the fact that some members of the household do not have residence paper and live illegally in social housing facilities (IV17) 5) perceiving that the main source of income in Roma local communities is child / maternal allowance (IV4) 6) perceiving that is more difficult for Roma than for Romanians to find a job (IV26) 7) perceiving that the main type of problem in Roma community from Prunului Street is related to housing (IV6: in this category were included problems like lack of social houses, lack of tabulated houses, lack of cleanliness, lack of space, the need for Roma to be moved somewhere else, the need for social houses renovation, and the danger of the housing buildings tearing down) 8) being in favour of the idea of Roma and Romanians living in the same neighbourhood (IV24) 9) perceiving that in Roma community from Combinat Colony there is a housing tenure issue related to the fact that Roma live in social housing facilities, and therefore they do not own their house (IV12).

Consequently, the prediction of Romanian respondentsâ&#x20AC;&#x2122; perception about the importance of Roma housing issue can be expressed as the following equation: DV1 =.437-.601IV8 +.308IV2 +.184IV5 -.181IV17 +.163IV4 +.15IV26 +.143IV6 +.139V24 +.126IV12

A closer look at the first multiple regression model indicates that Romanian respondents tend to perceive Roma housing issue as important when they think that in two specific local communities of Roma (Prunului Street and Combinat Colony) the main problems are related to housing conditions, housing tenure (lack of private ownership of the house, lack of residence papers for living legally in social houses), and poor enforcement of low and order. Moreover, the perception of Romanian respondents about the importance of Roma housing issues is determined by their perception about wage dependency of Roma (their main source of income not being the regular salary, but the social welfare or the child/maternal allowance given by the State). Moreover, Romanian respondents acknowledge the importance of Roma housing issue when they detach from prejudice and discrimination and realize that is more difficult for Roma than for Romanians to find a job, and accept that itâ&#x20AC;&#x2122;s normal for Roma and Romanians to live in the same neighbourhood.

For DV2, 12 simple linear regression models were statistically significant, showing that Roma autoperception about whether their housing conditions are important or not (and therefore should be included in public authoritiesâ&#x20AC;&#x2122; agenda) can be modelled as functions of civil status (married or consensual union) of the respondent and of different dimensions of Roma auto-perception (see Table 2 from the Appendix): - declaring improper housing conditions (not improper heating of the house or defective house equipments, but , lack of access to central heating or lack of kitchen inside the house) - declaring that the house lack some basic utilities (access to central heating or kitchen inside), but that they do not need them

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estimating that giving Roma the opportunity to buy the land on which their house is build illegally will increase of the quality of Roma housing (in this category were included declared benefices like: new possibilities for Roma housing, Roma will be motivated to invest in their houses, more space in the house, better conditions of living, attracting investments in public utilities for Roma houses, solving the problem of electricity) - being in favour on the idea of Roma and Romanians living in the same neighbourhood - declaring that in the last year they or a member of their family experiences prejudice and discrimination (felt offended by others because of being Roma, felt embarrassed / uncomfortable in front of strangers to recognize being Roma - perceiving that is more difficult for Roma than for Romanians to find a job.

The linear multiple regression model for DV2 (F (237) = 7.929, Sig. = .00 < .05) shows that 17.1% of the variation of the DV1 could be predicted by the following 6 independent variables (ordered by their prediction power from the strongest to the weakest): 1) declaring that the house is not connected to central heating, but that they do not need this public utility (IV34) 2) being in favour on the idea of Roma and Romanians living in the same neighbourhood (IV24) 3) declaring improper housing conditions dew to defective house equipments (IV32) 4) declaring that in the last year the respondent or a member of their family felt embarrassed / uncomfortable in front of strangers to recognize being Roma (IV40) 5) declaring that the house does not have a kitchen inside, but that they do not need this utility (IV36) 6) estimating that giving Roma the opportunity to buy the land on which their house is build illegally will increase of the quality of Roma housing (IV37).

Thus, the prediction of Roma respondentsâ&#x20AC;&#x2122; perception about the importance of Roma housing issue can be expressed as the following equation: DV2 =-.243+.658IV34 -.309IV24 +.248IV32 +.194IV40 +.177IV36 -.145IV37

The second multiple regression model suggests that Roma respondents perceive that the Roma housing issue is important when they personally experience lack of proper housing conditions (defective house equipments, lack of house connection to central heating, lack of kitchen inside the house), and, paradoxically, when they reject the need for some of them (connection to central heating, lack of kitchen).

Furthermore, the perception of Roma respondents about the importance of Roma housing issues is also determined by their perception that the solutions of buying the land on which their house was illegally built could lead to an improvement of Roma quality of housing. In short, they think the problem is important and need an urgent City Hall intervention, when they favour a particular solution to that problem, and assume that the solution would improve their quality of life. In addition, the Roma respondentsâ&#x20AC;&#x2122; awareness of the importance of the housing issue is determined by the internalization of stigma (declaring that in the last year the respondent or a member of their family felt embarrassed / uncomfortable in front of strangers to recognize being Roma) and by beliefs that social distance between Roma and Romanians should be reduced (being in favour on the idea that Roma and Romanians should live in the same neighbourhood).

4.

Conclusions

Romanian respondents perceive that the issue of Roma the housing issue is important, and therefore should be included in public authoritiesâ&#x20AC;&#x2122; agenda when they acknowledge: 1) the specific problems of two local Roma communities, 2) the wage dependency of the entire local Roma community and 3) the labour discrimination and the need to reduce residential segregation. Romanian respondents decide about the importance of the housing issue of the entire local Roma community based on perceiving specific problems of only Combinat Colony (enforcement of low and order and housing tenure), and Prunului Street (housing

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conditions) Roma communities. They do not take into account aspects related to small Roma communities from Plopului Street and Negoiu Street where there are housing issues associated with the imposed change of residence. This situation may be due to the fact that local press had presented more frequently and more negatively the situation of Roma from Prunului Street and Combinat Colony. This idea is similar to the one developed by [24], who observed that “the visibility and homogeneity of the deviant characteristics of the social category are often amplified by the media, which increases the public perception of the otherness of the inhabitants”.

Roma respondents perceive that the issue of Roma housing is important and therefore should be included in public authorities’ agenda when they: 1) acknowledge the lack of housing utilities and amenities and reject the need for some of them, 2) think a particular solution would bring them concrete advantages, 3) internalise social stigma and express he need to reduce residential segregation. The apparent contradictory situation of Roma complaining about lack of housing utilities and also rejecting the need for some of them might hide an economic struggle problem. Specifically, a big number of Roma from local communities detached their houses from utilities because they couldn’t afford to pay for them, and when they were asked to pay the rent for staying in social houses or the property tax for owners of the houses, they refused to pay saying the authorities are trying to rob them putting big taxes on houses without access to basic utilities.

These results almost confirm the hypothesis that the determinants of Roma and Romanian respondents’ perceptions about the importance of Roma housing issue are different, except the discrimination determinant (both Roma and Romanians being in favour of the need to reduce residential segregation). The other discrimination determinant is different from Roma and Romanian respondents because Roma respondents take into account the internalisation of stigma in social life (feeling embarrassed or uncomfortable in front of strangers to recognize being Roma) while Romanians the stigmatisation of Roma on labour market (being more difficult for Roma than for Romanians to find a job). Another apparent similarity is considering the poor quality of Roma housing, but these determinants are very different. Romanian respondents concentrate on general housing problems of Roma from Prunului Street (lack of social houses, lack of tabulated houses, lack of cleanliness, lack of space, the need for Roma to be moved somewhere else, the need for social houses renovation, and the danger of the housing buildings tearing down) while Roma respondents on specific housing problems that all of them encounter in everyday life (defective house equipments, lack of house connection to central heating, lack of kitchen inside the house). Besides these, the other determinants are very different and suggest particular mindsets for Roma and Romanian respondents. Namely, Romanian respondents focus on aspects related to “low and order”, “house ownership”, “wage dependency”, “poor housing conditions”, “housing policy”, and “jobs” while Roma respondents on “access to utilities”, “quality of house amenities”, “potential increase of the quality of housing”, “land ownership” and “social embarrassment”.

Previous findings from Romanian context had shown the magnitude of problems like: discrimination against Roma [25], social distance towards Roma [26], legality of Roma house ownership [27], Roma houses access to basic utilities and facilities [28], Roma economic income sources [29]. This paper makes a step further by showing their causal power on the perception of the importance of housing issue in Roma and Romanians agendas. Additionally, by evidencing the public invisibility of collective evictions and relocations of Roma tenants from Negoiu Street to Plopului Street from Făgăraș City, this paper is consistent with the assumptions of [30] based on analyzing Roma public housing situation from five other Romanian cities (Bucharest, Cluj-Napoca, Piatra-Neamt, Tirgu Mures, and Roman). At the same time, the cited study points out to the visibility of criminality from Roma social houses neighbourhoods, that is also evident in the present study, which in addition shows its effects on the ethnic majority agenda.

Further studies need be done, in order to indentify whether the different determinants of Roma and Romanians perceptions might reflect different grounds for the decision making processes, and even different systems of values and beliefs.

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5.

References

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[2] Berescu, C. On Some Ethnic Housing Areas of Călăraşi. Studia Universitatis Babeş–Bolyai Sociologia. 2013, 58 (LVIII): 77-110.

[3] Berlin, J.. Housing–Related Problems of Roma in Finland and Gypsies and Travellers in England. In Proceeding of Salford Postgraduate Annual Research Conference. Manchester: The University of Salford. 2011, pp. 278-288.

[4] Dohotaru, A.-O. Performative Anthropology. The Case of the Pata-Rât Ghetto. Studia Universitatis Babeş–Bolyai Sociologia. 2013, 58 (LVIII): 193-216.

[5] European Centre for Minority Issues (ECMI). The Decade of Roma Inclusion. ECMI Fact Sheet. 2014, 11, March.

Retrieved from: www.ecmi.de/fileadmin/downloads/publications/Decade_of_Inclusion.pdf, accessed March 2015 [6] European Union Agency for Fundamental Rights (FRA). Case study: Improving Roma housing and eliminating slums, Spain. 2009, October. Retrieved from: http://fra.europa.eu/sites/default/files/fra_uploads/605-090210ROMA_Housing_Case-final-ENES.pdf, accessed March 2015.

[7] European Union Agency for Fundamental Rights (FRA). The situation of Roma in 11 EU Member States. Survey results at a glance. 2012. Retrieved from: http://fra.europa.eu/sites/default/files/fra_uploads/2099-FRA-2012Roma-at-a-glance_EN.pdf, accessed March 2015.

[8] Fleck, G. Income and Expenditure. In: G. Fleck, and C. Rughins (eds.). ibidem, p. 145.

[9] Fleck, G. Social Distance Attitudes. In: G. Fleck, and C. Rughins (eds.). ibidem, p. 72.

[10] Gheorghe, O., Serban, O. Gavril, F. and Levente, S. Poverty and Living. Roma Poor Neighborhoods in Romania and Hungary. The Annals of the University of Oradea, Economic Sciences Series. 2011, 1 (July): 137-.184.

[11] Harabula, H. Family as a Means of Survival, Formation and Inside Processes of a Roma Ghetto in Şumuleu. Studia Universitatis Babeş–Bolyai Sociologia. 2013, 58 (LVIII): 175-192.

[12] Kosa, K., Molnar, A., McKee, M. and Adany R. Rapid health impact appraisal of eviction versus a housing project in a colony-dwelling Roma (Gypsy) community. European journal of public health. 2007, 17: 217-217.

[13] Löw, M. S. The Social Production and Social Construction of Public Space. In: M. Löw (co.), On the Plaza: The Politics of Public Space and Culture. Austin: University of Texas Press. 2000, pp. 127-128.

[14] McGarry. A. Roma as a political identity: Exploring representations of Roma in Europe. Ethnicities. 2014, 14 (6): 759.

[15] Messing, V. Methodological puzzles of surveying Roma/Gypsy populations. Ethnicities. 2014, 14 (6): 811-829 [16] Molinuevo, D., Foti, K. and M. Koomen. Living Conditions of the Roma: Substandard Housing and Health.

Dublin: European Foundation for the Improvement of Living and Working Conditions. 2012. Retrieved from: http://eurofound.europa.eu/sites/default/files/ef_files/pubdocs/2012/02/en/1/EF1202EN.pdf, accessed March 2015.

[17] Molnár, Á., Ádám, B. Antova, T., Bosak, L., Dimitrov, P., Mileva, H.and Kósa, K.. Health impact assessment of Roma housing policies in Central and Eastern Europe: A comparative analysis. Environmental Impact Assessment Review. 2012, 33 (1): 7-14.

[18] Nita, D. L. Raxen - Thematic Study. Housing Conditions of Roma and Travellers – R. Center for Legal Resources.

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[19] Nolan, A. ‘Aggravated Violations’, Roma Housing Rights and Forced Expulsions in Italy: Recent Developments

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under the European Social Charter Collective Complaints System. Human Rights Law Review. 2011, 11 (2): 343361.

[20] Rughinis, C. Housing Issues in Survey Research. In: G. Fleck, and C. Rughins (eds.). ibidem, p. 119.

[21] Rughinis, C. Housing Issues in Survey Research. In: G. Fleck, and C. Rughins (eds.). ibidem, p. 121.

[22] Rughinis, C. Social housing and Roma residents in Romania. ibidem, p. 29 [23] Rughinis, C. Social housing and Roma residents in Romania. ibidem, p. 30.

[24] Rughinis, C. Social housing and Roma residents in Romania. Policy paper, International Policy Fellowships.

Budapest: Central European University, Centre for Policy Studies. 2004. Retrieved from: http://sar.org.ro/wpcontent/uploads/2013/01/Social-Housing-and-Roma-Residents-in-Romania.pdf, accessed March 2015.

[25] Rughins, C. Survey Analysis of Ethnic Affiliation. In: G. Fleck, and C. Rughins (eds.). Come Closer. Inclusion and Exclusion of Roma in Present Day Romanian Society. Bucharest: Human Dynamics. 2008, p. 59.

[26] Slaev, A. D. Bulgarian policies towards the Roma housing problem and Roma squatter settlements. European Journal of Housing Policy. 2007, 7 (1): 63-84.

[27] Tremlett, A. Making a difference without creating a difference: Super-diversity as a new direction for research on Roma minorities. Ethnicities. 2014, 14 (6): 830-848.

[28] Vitale, T. and Membrett,i A.. Just another roll of the dice: A socially creative initiative to assure Roma housing in North Western Italy. In: F. Moularet (ed.). The International Handbook on Social Innovation: Collective Action, Social Learning and Transdisciplinary Research. Cheltenham: Edward Elgar. 2013, pp. 186-196.

[29] Vitale, T. and Membretti, A. ibidem, p. 186.

[30] VuksanoviÄ&#x2021;-Macura, Z. The mapping and enumeration of informal Roma settlements in Serbia. Environment and Urbanization. 2012, 24 (2): 685-705.

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6.

Appendix Table 1: The measurements of the variables used in the study

Questions from the original study (response options) Data collected from Romanian respondents In your opinion, the issue of Roma housing in Făgăraș is or it is not an important or urgent issue to be solved

by City Hall? (it is very important; it is somehow important; it is not so important; it is not important al all) Sex of the respondent (masculine; feminine) What do you think is the main source of income for the Roma community from Făgăraș? (salary; income from self-employment, occasional activities or selling of goods; retirement pension; unemployment allowance; child / maternal allowance; social welfare; other source...)

What do you think is the main problem that should be solved urgently by City Hall in Roma community from Prunului Street? (open question) What do you think is the main problem that should be solved urgently by City Hall in Roma community from Combinat Colony? (open question)

From your knowledge, how do you evaluate the housing conditions of Roma from Combinat Colony? (very good, good, bad, very bad) Most of Roma houses from Negoiu number 1 block of flats lack connection to utilities: water supply, sewerage, electricity, gas, central heating (true; false) Most of Roma residents from Negoiu number 1 block of flats do not own the house they live in (true; false) Most of Roma residents from Combinat Colony are not owning the house they live in (true; false) Most of Roma residents from Combinat Colony are paying rents based on renting contracts for social houses (true; false) Some Roma residents from Combinat Colony are not paying rents, but staying illegally within other families who are paying rents (true; false) Some Roma residents from Negoiu number 1 block of flats cannot make legal papers for the house they live in because they do not have ID papers (true; false) Some Roma residents from Prunului Street and Plopului Street number 3, 6, and 12 block of flats cannot make legal papers for the house they live in because they do not have ID papers (true; false)

Dummy variables after recoding: response option coded 1

Abbreviations

The importance of the issue of Roma housing in Făgăraș: it is very / somehow important

DV1

Sex: masculine Income source: salary Income source: independent activities Income source: child / maternal allowance Income source: social welfare

IV1 IV2 IV3 IV4 IV5

Main type of problem in Roma community from Prunului Street: housing

IV6

Main type of problem in Roma community from Combinat Colony: economic struggle Main type of problem in Roma community from Combinat Colony: the enforcement of low and order Evaluating Roma housing conditions from Combinat Colony: bad or very bad

IV7

Perceptions about housing conditions f Roma community from Negoiu number 1 block of flats: lack of utilities Perceptions about housing tenure of Roma community from Negoiu number 1 block of flats: not owning the house Perceptions about Roma housing tenure in Combinat Colony: not owning the house Perceptions about Roma housing tenure in Combinat Colony: paying rent based on contract Perceptions about Roma housing tenure in Combinat Colony: not paying rent, staying illegally Perception about housing tenure of Roma community from Negoiu number 1 block of flats: not having ID, impossible to make legal papers for house Perception about housing tenure of Roma community from Prunului Street and Plopului Street number 3, 6, and 12 blocks of flats: true that not having ID papers, it is impossible to make legal papers for house

IV10

IV8

IV9

IV11

IV12 IV13

IV14

IV15

IV16

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In Roma community from Combinat Colony some members of the household don’t have residence papers (true; false) How do you think the living conditions of the Roma from Negoiu number 1 block of flats will be in a year? (much better; better, worse, much worse) How do you think the living conditions of the Roma from Prunului Street and Plopului Street number 3, 6, and 12 blocks of flats will be in a year? (much better; better, worse, much worse) How do you think the living conditions of the Roma from Combinat Colony will be in a year? (much better; better, worse, much worse) To improve Roma issues related to housing, which do you think is the best solution that City Hall should apply for Prunului Street and Plopului Street number 3, 6, and 12 block of flats? (open question) Starting from the case of the Roma community from Negoiu number 1 block of flats, a possible solution would be to move them elsewhere. How do you find tins solution? (very good; good; bad; very bad) In your opinion, the Roma community from Făgăraș is discriminated from the rest of population or not? (yes, it is very much discriminated; yes, it is discriminated somehow; no, it is not discriminated somehow; it is not discriminated at all) How do you find the idea of: Romanians and Roma living in the same area of the village, being neighbours? (it is very bad; it is bad; it is good; it is very good) Do you personally know such situations as: Roma and Romanians from local community helping each other in work? (yes; no) In your opinion in Făgăraș City, Roma, compared to Romanians, find it easier, harder or the same to: find a job (easier than for Romanians; the same as Romanians; harder than Romanians) To what extent do you agree or disagree with the following statements: Romanians should help Roma to integrate in society (totally agree; somehow agree; somehow disagree; totally disagree) To what extent do you agree or disagree with the following statements: the State should help Roma more (totally agree; somehow agree; somehow disagree; totally disagree) To what extent do you agree or disagree with the following statements: the State should help Roma more (totally agree; somehow agree; somehow disagree; totally disagree) Data collected from Roma respondents What is your opinion, the main problem in your area that should be urgently solve by City Hall? (open question)

Perceptions about Roma housing tenure in Combinat Colony: true that some members of the household don’t have residence papers Estimating that in a year Roma housing conditions from Negoiu number 1 block of flats: will be worse or much worse Estimating that in a year Roma housing conditions from Prunului Street and Plopului Street number 3, 6, and 12 block of flats: will be worse Estimating that in a year Roma housing conditions from Combinat Colony: will be worse or much worse Main solution that City Hall should apply to Roma communities from Prunului Street and Plopului Street number 3, 6, and 12 block of flats: improving housing situation Evaluating the solution of moving Roma from Negoiu number 1 block of flats: good and very good

IV17

Perceived discrimination of local Roma communities: it is very much / somehow discriminated

IV23

Opinion about Roma and Romanians living in the same neighbourhood: it is bad or very bad

IV24

Does not know situations of Roma and Romanians from local community helping each other in work: yes In Făgăraș City is easier, harder or the same for Roma than for Romanians to find a job: harder

IV25

Romanians should help Roma to integrate in society: totally or somehow agree

IV27

The State should help Roma more: : totally or somehow agree

IV28

Most of Roma children are beggars and pocket stealers: totally or somehow agree

IV29

The main problem in the local area that should be urgently solved by City Hall: housing issue

DV2

What is your civil status? (unmarried; married;

Civil status: married or living in consensual

IV30

IV18

IV19

IV20

IV21

IV22

IV26

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divorced; widowed; living in consensual union) In your house, you've experienced lately with any of the following problems: lack of proper heating? (yes; no) In your house, you've experienced lately with any of the following problems: defective house equipments? (yes; no) Which of the following utilities do not exist in your house and you really need: connection to central heating? (we already have; we do not have and do need; we do not have, and do not need) Which of the following utilities do not exist in your house and you really need: kitchen inside the house? (we already have; we do not have and do need; we do not have, and do not need) (for those who were in favour of the solution of buying the land on which they build their house) What advantages do you think you would have if you could buy the land? (open question) How do you find the idea of: Romanians and Roma living in the same area of the village, being neighbours? (it is very bad; it is bad; it is good; it is very good) In the past year, you or your family happened to feel offended by others because of being Roma? (yes; no) In general, you or your family feel embarrassed / uncomfortable in front of strangers to admit that you are Roma? (yes; no)

union Having house problems related to lack of proper heating: yes

IV31

Having house problems related to defective house equipments: yes

IV32

The house is not connected to the central heating: we do not have The house is not connected to the central heating: we do not have and do not need The house does not have a kitchen inside the house: we do not have The house does not have a kitchen inside the house: we do not have, and do not need Perceived benefices of buying the house land: the increase of the quality of housing

IV33

Opinion about Roma and Romanians living in the same neighbourhood: bad, very bad

IV38

Felt offended by others because of being Roma: yes Felt embarrassed / uncomfortable in front of strangers to admit being Roma: yes

IV39

IV34 IV35 IV36 IV37

IV40

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Table 2: Simple linear regression models for DV1 and DV2

DV1 Predictors IV1 IV2 IV3 IV4 IV5 IV6 IV7 IV8 IV9 IV10 IV11 IV12 IV13 IV14 IV15 IV16 IV17 IV18 IV19 IV20 IV21 IV22 IV23 IV24 IV25 IV26 IV27 IV28 IV29 DV2 Predictors IV30 IV31 IV32 IV33 IV34 IV35 IV36 IV37 IV24 IV38 IV39 IV40

R

R Square

Adj. R Square

Unstandardized B

Standardized Beta

Sig.

.141 .195 .254 .142 .103 .182 .112 .109 .143 .139 .103 .190 .110 .161 .172 .156 .164 .198 .167 .178 .184 .138 .184 .119 .101 .125 .180 .126 .103

.020 .038 .064 .020 .011 .033 .013 .012 .020 .019 .011 .036 .012 .026 .029 .024 .027 .039 .028 .032 .034 .019 .034 .014 .010 .016 .033 .016 .011

.017 .036 .062 .018 .008 .030 .010 .009 .018 .017 .008 .034 .010 .024 .027 .022 .025 .037 .025 .029 .030 .017 .031 .012 .008 .013 .030 .014 .008

-.122 -.759 -.251 .163 .098 .173 -.097 .153 .265 .128 .089 .166 .100 .146 .160 .139 .146 .204 .169 .183 -.151 .135 .167 -.134 -.106 .109 .197 .113 -.089

-.141 -.195 -.254 .142 .103 .182 -.112 .109 .143 .139 .103 .190 .110 .161 .172 .165 .164 .198 .167 .178 -.184 .137 .184 -.119 -.101 .125 .180 .126 -.103

.005 .000 .000 .004 .040 .001 .040 .047 .005 .005 .040 .000 .028 .001 .001 .002 .001 .000 .001 .001 .002 .006 .000 .018 .044 .013 .000 .012 .040

.111 .198 .123 .118 .118 .116 .116 .137 .164 .109

.012 .039 .015 .014 .014 .013 .013 .019 .027 .012

.010 .037 .012 .011 .011 .011 .011 .015 .024 .009

.119 -.202 -.122 .467 .467 .128 .128 .136 -.323 .110

.111 -.198 -.123 .118 .118 .116 .116 .137 -.164 .109

.031 .000 .017 .023 .023 .025 .025 .032 .001 .035

.132 .112

.117 .013

.015 .010

.138 .147

.132 .112

.011 .035

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Social Media as a Web-based Marketing Tool for Romanian SMEs Rocsana Tonis (Bucea-Manea)1†, 1

Politehnica University of Bucharest

Abstract. In this research, we intend to analyze how Romanian SMEs can be the beneficiary of Social media (SM) as a Web-Based Marketing Tool. Are there any enterprises that use SM and have a positive impact on Romanian SMEs? Which are the criteria of evaluation for high impact marketing online through SM? Which is the Romanian blogger profile? Which are the trends for SM in 2015 year? What is the impact of using social media in the firm’s efforts to access and connect to customers? How strong is this connection? (Does SMEs get constantly feed-back from clients? Do they win or lose clients through SM? Does the customer satisfaction increase? Are there fewer complaints?)

Keywords: social media, SMEs, web-based marketing tool.

JEL Codes: M15, O3

1.

Introduction

Our aim is to make aware the Romanian SMEs of the benefits of using SM so as to gain a market niche.

For the beginning we made a literature review on SM, regarding what is SM, which are the channels on SM, security in SM, SM as a marketing strategy, the blogger profile to get focused on SM and the trends for 2015 in SM. In the second part we have performed a case study on three Romanian companies, with online presence that can have a positive impact on Romanian SMEs. In our case study we focus on five criteria, such site content, applications, commercials, relationship with customers, measurement and Reporting.

2.

Literature review

The contributions of SM success are reflected in how effective SMEs’ communication with their clients is. Using SM the SMEs try to see the market through clients’ eyes. “Successful social marketing often depends more on qualitative metrics for desirable signs of the tone, quality and customer benefit of the interaction. These may include: unique visitors, interaction rates, relevant actions taken, conversation size, conversation density, content freshness and relevance, audience profiles, unique user reach.” [4] and [11].

With these metrics we can measure how involved are the clients in the companies’ activity, mentality.

SM can create a lot of opportunities and can change the shape and nature of its business all over the world. [9] SM may be used as a way of online advertising for companies which practice e-commerce. The internet provides the faster and the cheaper way to reach the clients all over the world.

There are a variety of ways by which the internet and e-commerce are useful for SMEs [10]:

 †

It facilitates the access of artisans and SMEs to world markets.

Lecturer, PhDc, e-mail address: rocsense39@yahoo.com.

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   

It facilitates the promotion and development of tourism of developing countries in a global scale.

It facilitates the marketing of agricultural and tropical products in the global market.

It provides avenues for firms in poorer countries to enter into B2B and B2G supply chains.

It assists service-providing enterprises in developing countries by allowing them to operate more efficiently and decision [6]. Pookulangara also tested culture as mediating factors to adoption in social media marketing.[13]

"Social media has fundamentally changed the way society interacts. Social media extinguishes and sparks riots boo and has changed the way we communicate and get to know better. “[15, Nick Palmer, MediaCom]. Social media, in general, has the aim to increase the number of fans, but this is not enough. To get profit, it is important winning customer loyalty is important to know the habits and attitudes of purchase, so that products and services are customized for them, both in terms of features and supply in time and space (region). "A perfect advertising involves a perfect message at the perfect time, for the right people, in a perfect context. If missing only one of these four factors, you could have just a media campaign", without excellent results. [15, Steffen Erhardt, Google].

Social media generally occurs through blogs, discussion forums on specialized topics attached to large sites (http://forum.softpedia.com/, http://pages.ebay.com/services/forum/feed-back.html, http://productforums.google.com/forum/#!forum/adwords-ro), social networks (www.facebook.com, http://twitter.com/, http://www.linkedin.com/, and the newest Google+), messaging platforms in real-time (Yahoo Messenger) and wiki sites.

Blogs are software platforms that enable synchronous chat, web hosting for personal files, archives, templates and colour schemes. Examples of such services are https://www.bloger.com/start, www.SocialGO.com, http://www.sosblog.com/.

The big advantage the blog services bring is different ways of self-expression and self-reflection, through text, images, audio, video, etc. The possibility of managing design and personal documents on the blog appeals to a sense of ownership, which has as a consequence greater involvement and increased social interaction.

Wiki sites are online databases of resources that can be added or removed from users’ desire, can be used as knowledge management systems in any field of business or learning. It is an alternative to the intranet.

But the most spectacular online tool that can be used in learning, in marketing, in the professional activity or relaxation is three-dimensional virtual world Second Life (http://secondlife.com/).

The forum aims to form a community to discuss topics of common interest, offering interesting and useful information. Discussion topics attract the user and cause him to open an account. Following these discussions will filter value members who will form the image of the forum.

Social networks allow sharing of information, files and media content in real time to friends, acquaintances, relatives and colleagues.

Google+ Google has changed the way of calculating the ranking of sites, with increasingly greater importance to social media. Although previous attempts failed (Google Buzz and Google Wave) to develop social networks, Google + launches consist of 5 main modules: Circles, Sparks, Hangouts, Huddle and Instant Upload. Google also added the +1 button, which has the same purpose and functionality of the Facebook Like button. To add this button on a site we recommend visiting the site

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https://developers.google.com/+/plugins/+1button/ , selecting the size, language and entering the Javascript in the page source code.

Facebook has introduced a new feature that allows anyone to automatically add someone into a group, without his consent. Then receive mail from the group all new posts and all comments. To create traffic Facebook hid the Leave Group and Logout buttons in the top right button for group settings. Due to Like button Facebook knows what the users like. But it wants gathering information on purchasing intentions of users, enabling them to be influenced them in choosing a product using Want button.

3.

Security on social media

Internet security is becoming increasingly vulnerable, social networks providing favorable conditions for online crime. Facebook receives over 600,000 online complaints daily regarding hacked accounts and decided to start working with the US Attorney General's office to combat linkjacking - a new form of intrusion into user accounts, specify largely for Facebook community. Through repeated identity theft, spammers send messages with false content (eg advertisements) or viruses, claiming that they are friends on Facebook. Hackers install virus programs on the computers of social networks members to gain access to accounts and profiles which they then rent or sell.

Ways that hackers get profiles from social networking [14]: 1. Intrusion into account - decoding the dictionary of passwords, which contains names and data that can be sold. The forums have many advertisements regarding the selling or offer of IDs Facebook.

2. Handling accounts - log in with the victim username and password illegally obtained. The offender can send any message in the name of hacked member, including the request for money.

3. Cloning profiles - Facebook accounts copy allows the offender to send friend requests to all those in the list to access the information it uses in committing fraud.

4. Cross Cloning accounts - obtaining information and images on Facebook and using them to create fake profiles on other social networks.

5. Phishing - the criminal claims to be a reliable organization and require network members personal information. Once the user has accessed the links sent by the offender, they infect his computer with malware or redirects to sites that provide grounds for disclosure of personal information. Another classic form of phishing is redirected to a fake Facebook login page with the same design.

6. Information unprotected - is to avoid publishing personal data (email, phone number, address, date of birth and other personal information) or use it to form secret passwords and security questions onFacebook.

7. Spam - mass sending of advertising messages to user accounts, without requiring them to ask for or give their consent to receive illegal. Social networks enable a new form of spam called clickjacking: at the click of a message, the message will be sent without user will to a list all his friends.

4.

What is the Romanian blogger profile?

According to the BR 2014 study conducted by refresh.ro and Vola.ro Romanian blogger profile is characterized by the person who is between 25-34 years old, lives in Bucharest, has higher education (college or master), started blogging after 2009 and writes under 30 articles on month. They earn money from advertising, banners, Affiliate Marketing, and special projects. The blogosphere in Romania is an industry that, at least in words, spent EUR 516,250 from companiesâ&#x20AC;&#x2122; pockets in 2013 compared to EUR

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619,750 in 2011. [11] In 2009-2011 the number of active blogs, trackbacks, posts, and comments experienced a boom. In 20122013 the number of active blogs drastically decreases and the same happened with the activity on its. In 2014 the blog market became mature: almost only people and companies that has something to say, and that learned how to use SM, creating high quality content, are active on blogs. (Fig. 1)

Fig. 1: Study BR 2014 - blog activity in Romania in 2008-2014.

The most popular social network is Facebook: 95% of Romanian bloggers have a Facebook account. "At present there are 901 million Facebook users, half of which is connected to the mobile terminals. Daily are uploaded 300 million photos on Facebook ". [15, Bruce Bale]. An example of successful Facebook page is Manchester United (24 million fans). Voting site by visitors is a measure of audience (Like or +1 button type). Other SM channels used in 2014 are Twitter, LinkedIn and Instagram.

Thus any company with online presence should consider developing a blog or forum to actively communicate with customers, to enable them feedback, to express opinions, suggestions and complaints about company’s products and services. The most effective form of marketing is direct marketing, viral marketing, which involves sending information from one person to another, providing a higher degree of confidence. Testimonies left by customers on the company's website are an effective form of free advertising. "92% of people trust word of mouth from friends and family. 47% trust in TV and radio. "[15, Bruce Bale] A study conducted by Unlock Market Research, published Social Media Summit, and held by Biz magazine presented six categories of users’ profiles on Facebook [1]:

   

Pragmatist: a detailed profile is available only in the circle of friends, which is not very large and rather interact very few on Facebook, being reluctant to non-informational content. Instead, he seeks information about products and promotions on the brands websites.

Militant: it has a large number of friends, who did not know any better. Do not provide information about itself, but discusses the common causes that they share.

Connector: the man who takes the message and then sends it on, is very dynamic, seeking more detailed information and recommendations Approver: has a small group of friends and do not provide information about itself. He often gives LIKE.

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ď&#x201A;ˇ ď&#x201A;ˇ

5.

Self-propagandist: provides very detailed information about himself and his passions. Write and spend more time on Facebook. It is very friendly.

Explorer: post news, ideas, original paintings, films, and is aware of the trends, and what happens interesting.

Social media as a marketing strategy

According to the Romanian blogger profile, companies should focus campaigns on self-propagandist who has many friends and spend more time on the internet. If he is convinced of the quality of a product or service, it will influence the perception of friends. Companies can address to militant and connector because they send the message further. The approver can be contacted to get as many Likes. Explorer can be attracted only with very good quality innovative product or service.

"Facebook Ads Product Manager, Gokul Rajard, said that Facebook Social Ads lead people to remember a notice (up 68%) and increases the opportunity for an individual to buy a product (an advance of 400% over traditional methods). Sponsored Stories allows advertisers to promote mouth-to-mouth recommendations and interactions with brands that exist in the Facebook News Feed. If, for example, someone's friend associates "like" to a brand, they will see this as the News Feed and on the right side of the screen. Facebook Ads are based on the idea that people want to see what their friends are doing. "[5] SMEs can increase their online visibility using social tools offered by social media. They can also increase the popularity, page rank and therefore online visibility receiving as many links from YouTube, which "drew a thousand billion views in 2011" and from Google: "loads an hour of content per second; 90% of European Internet users search Google for information about products and services". [15, Dan Bulucea] The user profile of social media influences its behavior on forums, blogs, and internet. Specialized studies in psychology and sociology have shown that estrogens and genetic constitution affects brain activity, with consequences in human behavior. Women use social media differently than men. Women are very attentive to detail, are more stable, preferring to maintain stable relations in social media, being inclined towards long conversations. Men do not notice details; they have a synthetic thinking, trying to get an overview. Men are more active, love to compete and conquer. Media campaigns must be prepared very well considering these features and other features such as cultural differences, role in society and needs. For example, although South Korea is a conservative country, 40% of Koreans have created one avatar, while in the US only 18% of Americans have an avatar. In India 69% of Facebook users are men and only 31% are women. China filters Internet access. In Russia Google is not the market leader in the segment of search engines, but Yandex, with a market share of 62%, and Facebook is in 5th place with only 8% of market share.

Also, SMEs with online presence should consider that 'the percentage of online shopping made in Romania is 80% versus other countries' [2, Dan Bulucea]. Thus 80% of online purchases are made from foreign companies: Amazon, eBay which dominate the local market.

In the online field the strategies of product, price, promotion and distribution take on different connotations. SMEs should consider online pricing strategies grounding a number of factors that may cause significant decreases in the price: 1. Consumers can easily search, nationally or worldwide, offers with the lowest prices; 2. The emergence of new products is immediately identified by both current or future consumers and competitors;

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3. Due to business globalization more taxes paid by the buyer tend to reduce or disappear (customs duties, VAT, etc.); 4. reducing manufacturers costs, importers or distributors reduces the online cost of products or services (staff salaries in trade and distribution, storage and marketing of the physical environment involves costs of around 300% on average, higher than in the virtual environment, etc.); 5. Internet companies are funded by investment funds or investors, who invest in brand image or to achieve a market share.

We identify three strategies online price that may apply: 1. Penetration price strategy - setting a relatively low price initially for rapid penetration into segments product or service; very effective for sensitive market such as the Internet; 2. The price leadership strategy - setting the lowest price for a given product in a given category; market share is covered by reducing the margin charged by identifying providers that offer the lowest prices, thus reducing running costs; 3. Promotional pricing strategy - temporary competitive prices, to encourage online shopping.

A site visit, a return to the site and shopping on the site are three different activities involving different strategies to address consumers. Companies need to invest today in social media to make their presence felt online. Once this online presence is felt, the company's business and its profits will be more obvious. Faulty implementation of social media can generate negative reactions to a particular brand, turning it into hot and negatively topic on Facebook and Twitter.

6.

Social Marketing for SMEs: What is the Impact of Using Social Media in the Firm’s Efforts to Access and Connect to Customers?

SM is used by SMEs to gather industry specific information and promoting their events and for online advertising and creating an effective online communication network. SM is more effective in building brand awareness and enhancing brand reputation. SM seems to be created for SMEs because they are more flexible and reduced cost of communications.

“With the proliferation of social media websites, the importance of word of mouth marketing and peer recommendation is becoming more pertinent for companies that are immersing themselves in online conversation with consumer communities.” [1] E-word of mouth is most effective, convenient and inexpensive marketing technique in online field. E-word of mouth can transform a company in market leader or destroy it. Its impact is due to the number of clients that have positive remarks regarding the brand. The online marketing strategy was well chosen if, a high positive feed-back comes from the clients. To avoid the negative impact the company had always say the truth, recognize the problem, try to remediate it and compensate the affected clients. The clients’ testimony on the SMEs site reflects market voice.

Different strategies have been suggested such as innovation in product planning, emphasis to new customers with environmental worries, new pricing perception, different approach to suppliers alliances, information management etc. [8] Concentration of key factors of change, key and strategic type of information. Foresight research in relation to the SME sector should focus on the dynamics of inter-organizational networks, that is, the search for relationships between the network participants, Social process involving the engagement of a wide group of experts [15] In SM Return On Investment (ROI) turned from the Risk Of Ignoring. [9]. This explain how important is for SMEs to have online presence.

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Nowadays, in Romania, the statement "one content, multiple distributions" is vital because it is important to be present where the user is: on the PC, phone or tablet, in the car (cars connected to the Internet are becoming very relevant) on TV (Smart TV apps are still not embraced by too many in .ro) [2]. The most important growth factors of an online publisher is quality and quantity content with focus the reader.

Interactivity will be the key consumed mobile content. The solution is niche-media, quality, and real engagement with the community of readers. Flipboard models are sustainable: aggregate content selected by human assistance but, clearly structured on niches of interest from multiple sources in a graphic experience as friendly but still spectacular. Today the battle is on the share of attention. The content and credibility are two concepts that go hand in hand and must be reported now, more than ever, for those who have something to say. A mosaic of text, photo and video as attractive combined so as to provide essential information, not to be bored and attractive from visually.

7.

Which are the trends on social media for 2015?

SM is very important because 86% of Romanians from the Internet enter to Facebook and use Google (Gemius), 68% of Romanians use a smartphone to enter the Internet (IBRL), 50% of online traffic comes from mobile until the end of 2015 (Emag study), 4.5mil Romanians enter monthly on e-commerce sites (Gemius), 81% of Romanians’ believe that technology can make life better (Ericsson). In 2015, marketers will need to understand that site design for mobile is not a "fad" but a "must" for the major trends of 2015[16]: Mobile: traffic coming from mobile, will be in an exponential growth and is potentially more valuable than PC traffic, as a visitor from mobile is seeking specific information rather than just making a simple surfing. Mobile traffic assures digital proximity to the consumer.

Social Media: “Social media is a constant presence in everyday life and activity, no matter if we are talking about persons or companies. All the companies that survived the economic crisis understand that the on-line presence is vital for publicity, in order to increase sales, in order to gain new clients. The companies struggle to get new visitors on the site and turn them into clients that return to the companies’ products, increasing the online visibility. To increase online visibility the companies enrol in search engines such as Google, Alta Vista, etc, enrol in web directories and use social media instruments such as forums, blogs, Facebook, Twitter, link exchange and other paid methods such as Pay Per Click campaign”. [12] Social media is not only the trend, it is more active than ever. The story must be about your social consumer, not about your organization. Social media hides a mountain of customers’ data. It is high time the tools such data layer, tag management, programmatic buying or segmenting audiences, become common in social media. The trend for 2105 is remarketing, custom audiences, audience lookalike and conversion tracking.

Technology: It is proved that brands and customers embracing technology in early stage gain to achieve the on medium term a significant advantage over competitors with a very good cost or efficiency ratio.

Agile Marketing strategies and tactics are working on small are launched quickly, monitored daily and adjusted on the fly. Information from monitoring are used to modify the implementation of both existing campaign and for other campaigns that are running or planning. The cycles are very fast and monitoring and enforcement meetings are held daily (usually at the beginning of the day), as well as in Agile Development.

Applications should be present in every marketer's arsenal:

 

Google Analytics (all actions related to the promotion of a website or online campaigns running should go from here, from the analysis of site traffic) Google My Business (location or regionalization brand)

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   

Buffer to share interesting articles on multiple social networks simultaneously.

HootSuite easier to monitor activities and discussions in social networks Sumall. Think of Google Analytics, but not for its own site, but for social networking accounts.

Infogram, easier to create computer graphics, which still are very popular in social networks and generate traffic.

Gamification: If 70% of Global 2000 companies in 2014 had at least one gamified application in its portfolio, it is a clear sign that there is not a trend to ignore.

Search Engine Optimization has two types of instruments on-page and off-page optimization. They are all detailed in the article Search Engine Optimization in the Current Socio-Economic Challenges. [12] As a conclusion, the future is digital and marketing is in the hands of men, and they will make the difference between Dinosaur type organizations and Alien organizations.

7.1.

Case Study: Are there any enterprises that use SM? Research methodology:

The foregoing sections lead us to the conclusion that the most important criteria in SM evaluations are: the content of the site, the applications that attract clients through playing and relaxing activity, the commercials that bring the connection from other sites, the relationship with customers, that has to feel they are unique and measurement and reporting, which allow the site manager to keep tracking of the activity on the site.

1. Contents: site content has to be frequently updated with high quality information. The quantity of the content is important, too, but has to be well organized and to offer answers to different types of clients, for different problems. The SM content has to respect the same rules. They both have to contain high quality text, video, photos.

2. Applications - Applications can be games, mini-sites, can integrate functions to make a donation, even from Facebook for example, questionnaires may be of prize contest or be music applications for job, the dating or type news.

3. Commercials refer to paid advertising space for others that users see and which, if clicked, can be taken to an external site. Changing commercials between sites, usually lead clients from site to site, increasing the visibility and the page rank.

4. Relationship with customers is the foundation piece in any business, especially for SMEs that cannot afford to lose customers. The SMEs interfaces have to be adapted for each client. The honored customer will come back to buy the services or products.

5. Measurement and Reporting tools are designed to understanding and knowledge of behavioral patterns and algorithms work online Facebook. Understanding the client behaviour help the management to answer their requests.

We performed a comparative analysis between three sites regarding the criteria above exposed.

The https://www.techsoup.ro/ is a site dedicated to Romanian NGOs, offering free access to IT resources. Romanian SMEs could get involved in different activities with the NGO community, accessible on this site. 1,200 NGOs in Romania are already part of the TechSoup Romania community. Their offer is very wide: Cloud Computing, Communicate and Collaborate, Go Green, Hardware, Keep Systems Secure, Manage Donors and Constituents, Manage Workstations, Organize and Manage Data, Planning and Strategy,

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Servers and Networks, Social Media and Community, Train & Learn, Web, Multimedia and Design, Website Management, Work Remotely The http://adsoft-solutions.com/ is a Romanian company that offers web solutions using Open Source technology that is free (e.g. Joomla). Romanian SMEs could get immersion in the online through this company services.

The last one is SAP for Romania that offers a wide range of free solution for Romanian SMEs on Cloud, Analytics, Business Applications, Database & Technology, and Mobile. (https://www.sap.com/romania/software-free-trials/index.html)

Research Results: https://www.sap.com/ro mania/solution/sme/soft ware/erp/overview.html

Criteria

https://www.techsoup.ro/

http://adsoftsolutions.com/

Contents

High quality and up to date content on the site and social network

High quality content on the site with an impressive portfolio. Outdated content on Facebook.

Very high quality content on site and social networks

Applications

Yes. Newsletter mail Chimp on Facebook

No.

Newsletter

Commercials

There is an empty space dedicated for commercials

No.

No

Relationship with customers

Very tight relation. Ask for registration and customized offer

No

Very tight relation

18091 likes on Facebook

312252800 members on Twitter, Facebook, LinkedIn, YouTube, Slideshare, Google+, Corporate Blogs,

Measurement and Reporting

2945 likes Facebook, 1037 tweets,721 followers

As we may see above, in general, companies focus on content. That is very good, keeping in mind that the forecast for 2015 talks about quality content, quantity and mobile. The all 3 companies might improve the visibility through application and commercials. Techsoup and Adsoft-solution has to invest a lot of time in creating and maintaining activity on social networks such as Instagram, LikedIn (a professional network), ResearchGate (professional network for researchers and scientists â&#x20AC;&#x201C; even them can become entrepreneurs), YouTube and Google+ (brings very high quotation for Search Engine), Slideshare, etc.

8.

Conclusions

The SME can get involved in partnerships with NGOs, such as Techsoup, or other big companies such as SAP. They may use open source technology as to reduce the overall cost. In SM the SMEs may use free online surveys tools to evaluate clientsâ&#x20AC;&#x2122; opinion and to post the results on the site. They have to answer to all

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clients complains, drawn from surveys or direct conversation. The SMEs should publish all the insights of their businesses on the SM. The SMEs transparency and sincerity is associated with client trust. The SMEs that are involved in charity events, in volunteer projects and in sustainable development actions have a stronger brand. The SMEs have to post pictures and video with the backstage activity, with the special events they attended, organized or celebrate, with their products and services. “We want to know the people behind the products and services we consume” seems to say the internet users in 2014. All the awards received have to be mentioned on the site or SM. They have to explain the technology they use and why that technology is better. Letting the competition talk on SMEs site or SM, organizing interviews with them it is another proof of fair-play. They have to reply to each client with a common and friendly language, without clichés and repeating their name. Punctuation or spelling mistakes are not acceptable. Posting scientific articles with news in the field the SMEs act is a very important technique to prove the up-to-date company culture. Free coupons and discounts can retain the client. Initiating discussions on different themes associated with SMEs activity field is a method to create traffic and get client feed-back.

9.

Acknowledgements

This paper is supported by the Romania’s Sectoral Operational Program for Human Resource Development (POSDRU), financed from the European Social Fund and the Romanian Government under the POSDRU/159/1.5/134398 contract.

10.

References

[1] Goaga, A. New Media, Cele sase tipologii de oameni de pe Facebook - TU unde te incadrezi? 2012, http://www.wall-street.ro/articol/New-Media/ [2] Cocioaba, C., Negrea, A. Blogosfera din România in 2014, E-book, http://refresh.ro/ [3] Cocioaba, C., Negrea, A. Tendinte in publishing online in 2014-2015, E-book, http://refresh.ro/ [4] Öztamur, D., Karakadılar, İ. S. Exploring the Role of Social Media for SMEs: As a New Marketing Strategy Tool for the Firm Performance Perspective, Procedia - Social and Behavioral Sciences, 2014, 150: 511-520 [5] Kelly, G. Cum să fii atragator pe Facebook și Twitter? 2012, http://www.wall-street.ro/editorial/523/10reguli-în-social-advertising-Cum-sa-fii-atragator-pe-Facebook-și-Twitter [6] El-Gohary, H. Factors affecting E-Marketing adoption and implementation in tourism firms: An empirical investigation of Egyptian small tourism organizations, Tourism Management, 2012, 33 (5): 1256-1269 [7] Ejdys J. Future Oriented Strategy for SMEs, Procedia - Social and Behavioral Sciences, 2014, 156: 8-12 [8] Bourletidis, K., Triantafyllopoulos, Y. SMEs Survival in Time of Crisis: Strategies, Tactics and Commercial Success Stories, Procedia - Social and Behavioral Sciences 2014, 148: 639-644, [9] Dahnil, M. I., Marzuki, K. M. , Langgat, J.and Fabeil, N. F. Factors Influencing SMEs Adoption of Social Media Marketing, Procedia - Social and Behavioral Sciences, 2014, 148: 119-126.

[10] Savrul, M., Incekara, A. and Sener, S.The Potential of E-commerce for SMEs in a Globalizing Business Environment Procedia - Social and Behavioral Sciences, 2014, 150: 35-45 [11] Tonis (Bucea-Manea), R., Bucea-Manea-Tonis, R. Webmarketing, Ed. Fundației România de Maine, Bucuresti, 2011, ISBN: 978-973-163-877-5 [12] Tonis, R. Search Engine Optimization in the Current Socio-Economic Challenges, Review of Applied SocioEconomic Research. 2012, 3 (1): 35 - 42.

[13] Pookulangara, S,. Koesler, K. Cultural influence on consumers' usage of social networks and its' impact on

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online purchase intentions, Journal of Retailing and Consumer Services 2011, 18 (4): 348-354 [14] Banila, M. TOP 9: Inselatorii pe Facebook, 2012, http://www.manager.ro/articole/social-media/top-9:inselatorii-pe-facebook-19301.html [15] Conferinţa New Media 2012, Bucharest.

[16] Digital Marketing Forum, 65 de previziuni care contează în digital marketing, în 2015, Evensys E-books, http://refresh.ro/

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Strategic Environmental Assessment – necessity, principles and specificities Monika Sabeva1+ 1

University of National and World Economy, Sofia, Bulgaria

Abstract. With the development of market economy, the upgrading of manufacturing activities and the globalization of all spheres of public life, it now becomes clear that the pace of economic growth may decrease and even to acquire a negative entry, under the influence of environmental pollution. This requires an assessment of environmental risks, their management, reduction and/or prevention.

SEA is an essential tool for integrating environmental considerations into the preparation and adoption of plans and programs which are likely to have significant effects on the environment.

The purpose of SEA is to detect the environmental issues at an early stage of development the strategic decisionmaking and to assess the possible effects of their implementation.

The basic principles to be observed in SEA are integration, dialogue, responsibility, willingness to defend the decisions taken in the process, awareness (information), flexibility and democracy.

SEA procedure is characterized by the following features:  Public participation should be an inseparable part of the process.  Integrating of the planning process and the process of environmental assessment and continuous contact between the two teams.  Successful consultations amongst with the stakeholders.

The relations between man and the environment are a prerequisite for the occurrence of a number of changes in it, that can significantly deteriorate the environmental conditions. This threatens ecosystems, social stability, health and economic development and requires strict measures towards nature conservation and preventing (or limiting) the adverse impacts.

Keywords: SEA; prevention; sustainable development; preventive control; environmental management Jel Codes: Q01; Q50; Q56; Q57; Q59

1. Introduction With the development of market economy, modernization of manufacturing activities and the globalization of all spheres of public life, it now becomes clear that the pace of economic growth may decrease and even to acquire a negative entry, under the influence of environmental pollution, natural resource depletion, reducing bioproductivity of land and continuously growing population. This requires an assessment of environmental risks, their management, reduction and/or prevention. For this purpose a number of methods and approaches for environmental assessment are established.

Environmental assessment [1] is an important tool for integrating environmental considerations in preparation and adoption of certain plans and programs which are likely to have significant effects on the +

Monika Sabeva; Tel: +359 2 8195 294; Mobile: + 359 898 26 76 28.

E-mail address: monikasabeva@abv.bg

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environment in the European Union Member States. Strategic Environmental Assessment (SEA) refers to the policy of the EU and in most cases takes place before Environmental Impact Assessment (EIA). This means that information on the environmental impact of the plan can be used for decision-making in EIA at a later stage, which could significantly reduce the amount of work in subsequent evaluations.

SEA[1] is inseparable from the term â&#x20AC;&#x17E;sustainabilityâ&#x20AC;?, and is expected to be carried out as a part of a wider Sustainability Appraisal (SA), which was already a requirement for many types of plans before the SEA Directive and includes social and economic factors in addition to environmental. Essentially SA is intended to better inform decision makers on the sustainability aspects of the plan and ensure the full impact of the plan on sustainability is understood.

Strategic environmental assessment [2] is carried out for plans and programs which are prepared for agriculture, forestry, fisheries, energy, industry, including mining activities, transport, regional development, waste management, water management, telecommunications, tourism, urban planning or land use and which set the framework for future development consent for projects listed in Annex I and any other project listed in Annex II of the Environmental Protection Act, which requires an assessment of environmental impact under national law.

The EIA Convention [3] in a Transboundary Context of the United Nations Economic Commission for Europe on February 25, 1991, encourages the parties to the Convention to apply its principles to plans and programs. In May 2003 in Kiev, Ukraine the SEA Protocol is adopted. On this basis in 2004 was developed and adopted the SEA Directive, which in practice SEA become obligatory. This Directive introduces a systematic evaluation of the environmental effects in the strategic use of natural resources.

Strategic Environmental Assessment [4] is carried out for politics, plans and programs. It constitutes a systematic evaluation process of the environmental consequences of application of relevant politics, plans and programs. This activity indicates the difference of sectoral politics at an early stage of operational decision-making and takes place simultaneously with their preparation, and takes into consideration their objectives, territorial scope and level of detail. Thus, the possible impacts of policies, plans and programs are identified, described and evaluated appropriately.

The purpose of SEA [4] is to render an account of environmental issues at the earliest stage of development of strategic planning decisions, when determining the territorial scope and evaluating the possible impacts of investment proposals in global strategies and development plans, and to make this process more transparent through consultation and participation. This assessment provides decision makers the required information to enable the consideration of the potential environmental hazards from the implementation of the plan/program.

Objects of SEA [4] are strategies, plans and programs in industry, energy, agriculture, forestry, tourism, transport, mining of underground and ground resources, water use and management of water resources, fisheries, spatial planning and land use, waste management, electronic messages, when these plans and programs outline the framework for future development of investment proposals.

Subjects of SEA [4] are the Minister of Environment and Waters, and the Directors of Regional Inspectorate of Environment and Waters (RIEW). These government bodies are authorized to give opinions in validation the national and regional plans and programs. Such assessments are prepared by registered experts, employed by specialized departments and assisted by researchers working in the field of Ecoeconomics. Subjects of SEA are also the registered experts preparing the reports that underpin the opinion of the Minister of Environment and Waters and the Directors of Regional Inspectorates.

The purpose of this paper is to analyze the Strategic Environmental Assessment (SEA), describing its stages, basic principles, characteristics and groups of indicators applicable to the implementation of SEA.

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2. Basic SEA principles The basic principles to be followed in SEA [4] are the principles of integration, of dialogue, of responsibility for reduction or complete elimination of the environmental impacts, of awareness, of flexibility, of democracy and willingness to defend decisions taken. They are characterised as follows:  Principle of integration – This principle is applied during the implementation of the planning process in the preparation of plans and programs for development of various sectors. According to this principle, the SEA process should be integrated into the planning process and to take into account environmental issues at an early stage. It also requires a constant exchange of information between the two teams: the one who makes out the plan / program and the one who makes the assessment, in order to be achieved a high integration and to be avoided the disparities between development priorities and the loss of time and energy;  Principle of dialogue – it requires the planning authorities to be in a constant dialogue with each other and with experts in environmental assessment, and that dialogue to begin as soon as the decision about the need of the plan / program is taken. If the SEA starts after the key decisions about the plan / program are taken, it is almost impossible to influence them;  Principle of responsibility for reduction or complete elimination of the environmental impacts – the responsibility falls on the assignor of the plan / program, who must consult with the authorities in environmental protection and during the implementation of the plan / program to comply with environmental objectives set. Also, the assignor should prepare a report on the environmental assessment;  Willingness to defend decisions taken and to eliminate adverse effects on environment – The environmental report should be submitted as part of the plan / program or along with it and the decisions must comply with the recommendations of the Report, and to contain clear references to it.

If it is unlikely to comply some of the prescriptions of the Report, the authorities should justify its decision very well;  Principle of awareness – finds expression in the inclusion of public and civil community in the environmental assessment process through their participation in discussion of solutions. For this purpose, the public must be informed of the steps of the environmental assessment of the plan / program and opportunities for participation. The results of the assessment must be understandable for the general public;  Principle of flexibility – requires the implementation of a flexible mutually acceptable approach in identifying the correlation between the planning procedure and methods of evaluation of individual environmental impacts;  Principle of democracy – it is expressed in applying the democratic approach when making decisions for implementing the various stages of evaluation. For this purpose it is better to have coherence between different policy sectors and various levels of governance, and public participation.

SEA [4] is implemented in compliance with the principles and legal requirements of the environmental assessment. Identification of steps and procedures for organization and conducting of SEA is associated with distinguishing the methodological steps of the procedure and the development of individual plan / program.

The steps in the process of developing the plan / program are the basis for determining the stages of the SEA. SEA [1], [3] is a legally enforced assessment procedure required by Directive 2001/42/EC (known as the SEA Directive). SEA Directive aims to establish a systematic assessment of the environmental impacts of strategic plans and programs related to land use. This assessment usually refers to local and regional development plans of the waste management and transport within the European Union. SEA Directive only applies to plans and programs, not politics.

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3.

Stages of SEA SEA, under the SEA Directive, includes the following steps [1], [3]:  Screening – determines whether the plan or program falls within the scope of SEA legislation;  Scoping – determining and evaluating the scope of the assessment, making assumptions and guesses, determining the scope and content of the procedure and the groups (teams) which should be involved in the process of environmental assessment, and determining the possible connection of the plan / program with other plans / programs;  Documenting the environmental conditions – a baseline scenario is developed and the baseline values, which are the basis of decisions related to evaluation, are determined;  Determining the possible (non-marginal) environmental impacts – indicating the environmental impacts that might be relevant to the project, using accurate data and numbers;  Informing and consulting the public – evaluation results should become available for the public;  Impact of the decision – which management decisions will follow the assessment and how they are influenced by it – SEA objectives are related to determination of environmental criteria for evaluation of the selected option. Alternative ways to achieve the goals of the plan / program and measures to reduce the adverse impacts on the environment are suggested. It is necessary the potential implications of implementation of the plan / program for the areas and sectors covered by it to be considered, and also the existing situation to be assessed. The evaluation results are provided to the planning team and the two teams discuss them. At this stage no quantitative assessment of impacts is made. It is developed only during the EIA of investment proposals;  Monitoring – what is the effect of implementation of plans and programs and how do they affect the environment. Measures to monitor the effects of the selected alternative are developed. The SEA team assesses the proposed program for monitoring the implementation of the plan / program and suggests measures for monitoring the environment. Thus ensures that appropriate attention to environmental impacts will be given during the implementation of the plan / program. Both teams discuss the proposed measures. During all stages of the SEA the team documents the results and summarizes them in an Environmental Assessment Report, including the non-technical summary of the Environmental Assessment Report, which is available to the public. This report includes comments from interested parties. It provides information about the environmental impacts and must be comprehensible. And the non-technical summary should be available to the public. At the end of the stage, the SEA team submits the Report to the assignor and participates in its public hearing and justification.

4. Evaluation of the alternatives The different alternatives [4], developed in the planning process are evaluated and then one of them is selected and is developed in details. It is necessary to determine whether the alternatives meet the environmental objectives and simultaneously recommendations and conditions for further development of alternatives to be provided. The team developing the plan/program develops the objectives into possible alternatives and the SEA team determines the extent to which they meet the environmental objectives. It is possible the assessment to be very uncertain, as it is based on strategic proposals which are not developed in details. During this assessment the following methods are used:  Determining the qualities of the impact by an impact matrix – it gives a visual and comprehensible presentation of the assessment results;  Preparation of questionnaires, interviews and discussions, appropriate for gathering information – through this method it is easier to reach consensus and transparency;

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 Checklists – they are applied for registration of significant impacts and it is imperative that lists to be carefully prepared and to consider that the combined and cumulative effects involve more complex cause-effect relations than those of investment proposals;  Trend analysis – it is used for evaluating the state of natural resources, ecosystems or the sensitive areas for a certain period. It is possible to make a graphic projection that reflects both past and future state and thus present the changes;  Geographic Information Systems – they are used for spatial representation of the results of the analysis. They are suitable for determining the area of the most significant influence of the individual factors, or where there is a stress concentration due to development;  Analysis of Ecosystems and Biodiversity – It contributes to drawing the attention on the sustainable use of natural resources;  Application of diagrams, networks, systems and other means of explaining and illustrating the cause-effect relations and determining both direct and cumulative impacts;  A popular method of forecasting and risk evaluation is the expert assessment. This method is applied in order to achieve a consensus among the various stakeholders in SEA.

5. Contents of the SEA report As any other procedure, SEA ends up with a detailed report that contains [4]:  Description of main objectives of the plan/program and relations with other plans/programs – These objectives must be clearly identified and principles and relations with all procedures concerning the evaluation should be described;  In-depth analysis and evaluation of all environmental issues relevant to the procedure. All alternatives are considered and the most economically advantageous tender is chosen;  Assessment of environmental impacts of the chosen alternative – here is determined which impacts can be eliminated or minimized and measures for further monitoring are described;  Describing the results of the environmental assessment (justification and summary of the decisionmakers);  Determining the environmental objectives of the plan/program of the relevant sector (area);  Evaluation of different alternatives of the plan/program – determining how they contribute to achieving the environmental objectives related to the plan/program;  Measures for monitoring and reducing the impacts of the selected alternative of the plan/program.

6. Characteristics of the procedure SEA procedure [4] is distinguished by the following features:  Public participation should be an integral part of the environmental assessment of plans/programs.

The form of participation should be consistent with the nature and scope of the problems associated with the plan/program and to reflect the interests and values of the affected parties;  Integration of the planning process with the process of environmental assessment and continuous contact between the two teams – The planning and environmental assessment teams should work in parallel and organize joint discussion of the results of environmental assessment at every stage of planning, in order to allow the plan/program to take into account the national and international goals in the sphere of environment;  Successful consultations among stakeholders – they can be held in different ways. Their implementation is possible on the basis of forming an expert or public group for determining the extent of the problem and methods of implementing the debate on the problems encountered. To do

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so, the upcoming evaluation procedure of the plan/program should be brought to the attention of public.

7. Necessity of SEA The assessment system is needed [5], [6] due to the following basic positive and negative characteristics of the method:  Integration of SEA during the formulation process of PPPs can not be achieved by adjusting the existing EIA for a project to the relevant legislation, procedures and forms. SEA has new methodological and procedural requirements. Particular efforts are needed for identifying the indirect, the secondary and the cumulative impacts that are not adequately covered by EIA at project level. The effects of strategic actions are often much more uncertain than those of projects so the methods for conducting SEA should be able to cope with this uncertainty. The timeframe of the SEA, the evolutionary nature of the strategic actions and their interaction with other strategic actions are also very different from those for specific projects and should to be considered when developing and adopting the methods of SEA. However, some principles and concepts of EIA are synonymous in SEA – they include consideration of the need of strategic actions, of alternatives and means to mitigate adverse impacts, stakeholder participation and taking into account a wide range of disciplines in the evaluation process.  With increasing the awareness of the issues related to environment and sustainable development on a political level and in parallel with the development of environmental management systems (EMS) in government and industry, issues related to environmental protection become more important in the process of decision making. They can now include elements of SEA. For example, forming the catchment areas, the integration management plans, regional ecological plans and programs for environmental protection, etc. can now include SEA – methodologies, although they can not be recognized as such. Under this process it is necessary to determine where the elements of SEA are included and where they are insufficient, to be complemented, or to be provided an integrated framework for SEA, where there is none. When applying SEA all considerations (concerns) related to environment and sustainable development that have already been taken into account in existing strategic plans and activities should be clarified. This tendency of convergence of SEA with other methods of planning in consideration of environmental and social parameters and those related to sustainability, has certain benefits but also leads to some confusions and can lead to the assumption that "we already do SEA but do not call it so". This is partially true, but SEA can determine the framework for introduction of these techniques together in a more structured and comprehensive manner, moving towards to a more integrated analysis of sustainability. Even where the existing techniques focus on the environment, the SEA allows this focus to expand, which is particularly suitable for strategic actions (plans) and for decision-making, where certain environmental costs can be balanced by other environmental benefits on another level where strategic decisions should be based on a wide range of social, economic and environmental factors.  SEA can be applied to a wide range of strategic actions at all levels (international, national, regional, local), sectors and resources, plans and politics and in terms on fundamentally different issues.

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8. Political and institutional context The reason for describing the political and institutional context of SEA [7] is that it defines the objective of strategic actions and determines what can or can not be done in strategic plan. This step involves identifying of:  The strategic actions, which are to be prepared and a response to the questions why these exact actions will be prepared; what other strategic actions are required by law (if any) and what is the history of development of the plan;  Other strategies that support or limit the forthcoming strategic actions – higher requirements or a low level of actions that can help or hinder the implementation of the strategy;  Current opportunities and practices for protecting the environment – at what professional level is the business in the area, is there a system for environmental management, etc.;  Contemporary approaches to social issues – how and to what extent the problems with gender inequality and poverty were overcome, how important are the traditional cultural and religious practices and how would they influence the decision for strategic actions;  Other institutional factors such as: who has the most important role in taking the key decisions in the field; what determines the funding; is cooperation with other organizations that are not local a common practice, etc.

9. Limitations of SEA SEA is a new procedure referred to preventing environmental damages caused by decisions about adopting or not programs, plans and politics, relevant to the aspects of environment and human life. As a relatively new tool for integrating sustainability in decision-making, SEA has a number of technical and procedural constraints [8], [9], namely:  On the technical side the relative lack of case studies and experience of SEA exacerbates these limitations. On the procedural side decision-makers, competent authorities and stakeholders must be aware that SEA is inherently a political process, and should ensure that SEA informs decisions but does not make them;  Each SEA system and methodology should be able to cope with many issues – SEA must be able to cope with a more nebulous decision-making process, with uncertainty, with larger scales and with induced, secondary and cumulative impacts. The techniques used in SEA are often a combination of those used in traditional policy analysis and those used in EIA;  SEA and decision-makers – SEA might be seen as a political act aiming to mislead voters that politicians care about the environment, because many problems are not completely developed, but the focus is on some of their individual aspects, which leads to partial solutions.

Table: Technical and procedural constraints of SEA [8] Technical and Procedural Limitations of SEA Type

Limitation

Outcome

SEAs generally cover a large area - sometimes several countries and a large number of alternatives

This makes collecting and analysing data for SEAs very complex

Technical Uncertainty, in terms of future environmental, economic and social SEAs are subject to greater levels conditions, likely development as a result of the PPP, and likely future of uncertainty than project EIA technologies

ISSN: 2247-6172 Review of Applied Socio- Economic Research (Volume 9, Issue 1/ 2015), pp. 97 URL: http://www.reaser.eu e-mail: editors@reaser.eu Technical and Procedural Limitations of SEA Type

Limitation

Outcome

SEAs often have to cope with limited information

Environmental data collected in different countries are often incompatible or limited

SEAs have to deal with information at a different level from project EIAs

A national-level SEA needs to focus on national -level concerns, and thus may have to disregard impacts that are important at a local level but that do not influence a national-level decision

A strategic action may have no formal authorisation stage

Instead it evolves in fits and starts through to implementation. There may be issues of confidentiality. Decision-makers may also be concerned that SEA should not take over the process of decisionmaking. SEA is also inherently a political process.

The concept of SEA, particularly sustainability-led SEA, is not yet politically accepted

Many countries' traditional approaches to policy-making, the worldwide emphasis on economic well-being (e.g. GNP) rather than total quality of life, and the sheer effort involved in determining sustainability criteria/targets all frustrate this concept.

Procedural

10. Basic information needed before initiating SEA Some basic information [10] about a strategic action is needed before it can be subject to SEA:  What is the level (policy, plan, program) and scale (international, national, national, regional, local) of the strategic action? – The higher the level and larger the scale are, the more broad-brush and qualitative the SEA is likely to be.  What is the time period of the strategic action? – This affects the time period over which SEA predictions are made: most SEAs make predictions that go to, or beyond, the lifetime of the strategic action.  Is the strategic action one-off or cyclical? – Cyclical strategic actions are those that get updated regularly: typically every 3-10 years. For cyclical strategic actions, there will often be an existing strategic action which would act as the 'do minimum' scenario in SEA. One-off strategic actions are more likely to have an indefinite time-span, and typically won't be replacing an existing strategic action.  Is the strategic action for a sector (e.g. waste, energy); or a land use plan for an area (e.g. region, local authority); or something different still? – Sectoral strategic actions often lend themselves to modelling, and to more detailed, quantitative SEA predictions. Land use plans are often more complex, with more interacting factors.  Who is the competent authority, and what other stakeholders are involved in developing the strategic action? – Depending on who the SEA audience are, they could be fully involved in the SEA process, or could simply read and respond to SEA reports, or something in between.  Is the competent authority a public or a private agency? – This will determine who it is accountable to, what issues it must consider, and what constraints it works under.

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11. Development of objectives and indicators of SEA Methods of carrying out SEA [11] must be specified at the beginning of the SEA procedure. Guidelines for determining the scope suggest that the responsible authorities should specify the purpose of SEA at the stage of determining the scope and should work with the advisory bodies. If the responsible authorities intend to use an alternative valuation method consultations during the scoping stage are recommended. Some of the problems in identifying the SEA objectives are:  It is good practice for SEA objectives to focus on outcomes (or ends), not how the outcomes will be achieved ("inputs" or means). For example, they might focus on improved biodiversity, rather than protection of individual wildlife sites.  SEA objectives can be supported by a list of more detailed criteria or questions. For example, an SEA objective to protect the aquatic environment could be supported by questions about water quality, watercourses, aquifers and marine and coastal waters, water abstraction and flooding.

Impacts affecting the features which make up the historic environment can be identified through these supporting criteria.  The development of SEA objectives and indicators and the collection of baseline information should inform each other. As the SEA objectives become clearer, they should help to focus (and where necessary restrict) the collection of baseline information, whilst the baseline information should help to identify which SEA objectives are of most concern for a particular project.  Each SEA objective should be genuinely needed and should not duplicate or overlap with other objectives. Experience suggests that between 8 and 16 objectives are normally enough to cover the range of topics needed for SEA and to keep the process efficient and manageable.  SEA objectives should be linked to indicators which measure progress or otherwise towards or away from them.

Table: Determination of SEA objectives [12] SEA topics

Possible SEA objectives (to be adapted to regional/local circumstances)

Possible SEA indicators (to be adapted to regional/local circumstances)

 to conserve and enhance the integrity of ecosystems  prevent damage to designated wildlife and geological sites and protected species

Biodiversity, fauna and flora

 maintain biodiversity, avoiding irreversible losses  reverse the long term decline in farmland birds  ensure the sustainable management of key wildlife sites and the ecological processes on which they depend

 reported levels of damage to designated sites/species  achievement of Biodiversity Action Plan targets  reported condition of nationally important wildlife sites, Sites of Special Scientific Interest ( SSSI) etc.  number/area of Local Nature Reserves

 provide appropriate opportunities for people to come into contact with and appreciate wildlife and wild places Population and human health

 create conditions to improve health  protect and enhance human health

 number of transport/pedestrian/cyclist road accidents

ISSN: 2247-6172 Review of Applied Socio- Economic Research (Volume 9, Issue 1/ 2015), pp. 99 URL: http://www.reaser.eu e-mail: editors@reaser.eu  decrease noise and vibration

 number of people affected by ambient noise levels

 maintain and improve opportunities to access public open space

 proportion of population within 200m of parks and open spaces

 conserve and enhance the quality of the built environment  improve and promote appropriate access to the natural and historic environment  limit water pollution to levels that do not damage natural systems  quality (biology and chemistry) of rivers, canals and freshwater bodies  maintain water abstraction, run-off and recharge within carrying capacity (including future capacity) Water

 maintain and restore key ecological processes ( e.g. hydrology, water quality, coastal processes)  protect and, where necessary, enhance waterbody status

 quality and quantity of groundwater  water use (by sector, including leakage), availability and proportions recycled  water availability for water-dependent habitats, especially designated wetlands  extent of use of Sustainable Urban Drainage solutions in new development

 reduce / manage flood risk

Soil

 safeguard soil quality, quantity and function

 amount/loss of greenfield / brownfield land and proportion available for reuse  number of houses affected by subsidence, instability, etc.

 reduce levels of brownfield, derelict and  land identified on Scottish Vacant and Derelict contaminated land in the plan area Land Survey (number of hectares)  hectares of contaminated land in plan area  number of days air quality limits exceeded annually  to maintain and improve air quality

Air

 limit air pollution to levels that do not damage natural systems  limit air emissions to comply with air quality standards

 levels of key air pollutants / by sector and per capita  achievement of Emission Limit Values  population living in Air Quality Management Area  distances travelled per person per year by mode of transport (proxy indicator)  modal split (proxy indicator)  traffic volumes (proxy indicator)

 to reduce the cause and effects of climate change Climatic factors

 reduce greenhouse gas emissions  reduce vulnerability to the effects of climate change e.g. flooding, disruption to travel by extreme weather, etc.

 electricity and gas use (proxy indicator)  electricity generated from renewable energy sources and CHP located in the area (proxy indicator)  energy consumption per building and per occupant (proxy indicator)  carbon dioxide (CO2) emissions by sector/ per capita

ISSN: 2247-6172 Review of Applied Socio- Economic Research (Volume 9, Issue 1/ 2015), pp. 100 URL: http://www.reaser.eu e-mail: editors@reaser.eu  amount of development in the floodplain  flood risk  number and outcome of Listed Building Consent applications received  protect and, where appropriate, enhance or restore the historic environment  number and outcome of applications received for Listed Building demolition  preserve historic buildings,

Cultural heritage

archaeological sites and other culturally important features  promote access to the historic environment  improve the enjoyment and understanding of the historic environment

 number and outcome of applications for Scheduled Monument Consent received  number of planning applications rejected for not complying with Development Plan policy relating to historic environment  condition (as affected by strategic action of PPS)  number and outcomes of planning applications that affect gardens and designed landscapes

 to conserve and enhance landscape character and scenic value of the area

Landscape

 protect and enhance the landscape everywhere and particularly in designated areas  value and protect diversity and local distinctiveness

 number and area of designated landscape areas  percentage of land designated for particular quality or amenity value, including publicly accessible land and greenways

 improve the quantity and quality of publicly accessible open space  to promote sustainable use of natural resources and material assets Material assets

 minimise waste, then re-use or recover it  amount of waste generated through recycling, composting or energy  waste disposed of in landfill recovery  percent of waste recycled or reused  to promote effective use of existing infrastructure

12. SEA indicators: Potential SEA Indicators [13], [14], [15] according to assessment purposes – As the implementation phase of the Strategy progresses, it is recommended that each Implementation Sub-Group identifies those indicators most applicable to their activities, such that the development of an effective monitoring framework becomes an organic process, with indicators and review periods identified for each proposed action before implementation. In this way, there will develop an effective record of implementation, with associated indicators which will help identify trends for future baseline studies in conjunction with the next review of the Forward Strategy for Agriculture.

Indicators – the European Commission has developed a list of common indicators to be used in the Common Monitoring and Evaluation Framework. They are directed to improving the monitoring and implementation of the Rural Development Program. These indicators are divided into five groups – basic

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indicators related to purposes, basic indicators related to context, output indicators, outcome indicators and impact indicators. They are distributed in the respective axes: Axis 1 Improving the competitiveness of the agricultural and forestry sector; Axis 2, Improving the environment and the countryside through land management; Axis 3 Improving the quality of life in rural areas and encouraging diversification of economic activity and Axis Leader+ as follows:  Basic indicators related to objectives – here 36 indicators that are identical to those applied for Sustainability Impact Assessment are included. They are divided into 5 sub-groups – horizontal indicators and indicators for assessment of all the axes;  Basic indicators related to context – 36 indicators that are identical to those applied for Sustainability Impact Assessment are used. They are divided into 4 sub-groups – horizontal indicators and indicators for axis 1, 2 and 3;  Output indicators – 79 indicators are used. They are divided into 4 sub-groups – indicators for assessment of all 4 axes and they depend on the specific measures in the relevant axis;  Result indicators – 16 indicators for axis 1, 2 and 3 are included. They depend on the purposes of the relevant axis;  Impact indicators – 7 indicators are included – Economic growth; Employment creation; Labour productivity; Reversing biodiversity decline; Maintenance of high nature value farming and forestry areas; Improvement in water quality and Contribution to combating climate change.

13. Conclusions The relationship between mankind and environment is a prerequisite for occurrence of a number of amendments in it, which can significantly deteriorate its condition. This threatens ecosystems, social stability, health condition and economic development and requires the need of strict measures towards conservation and prevention (or limiting) the adverse impacts. Therefore an environmental assessment of all strategic and planning documents on different levels becomes a major tool for maintaining the ecological stability.

One of the most important procedures related to nature conservation and achieving the objectives of sustainable development is the strategic environmental assessment of plans and programs (SEA). SEA is one of the basic tools for preventive control and is also an integral part of the process of development and adoption of plans, programs and politics. Its main objective is achieving a sustainable development, minimizing the adverse impacts on environment and improving its quality. SEA should ensure that plans and programs take into account the potential environmental impacts they cause.

Environmental assessment is an important tool for integrating the environmental considerations into preparation and adoption of certain plans and programs which are likely to have significant effects on environment in the Member States of the EU. Strategic Environmental Assessment refers to the policy of the EU and in most cases takes place before EIA.

14. References [1] http://en.wikipedia.org/wiki/Strategic_environmental_assessment [2] SEA Protocol the Convention on the Environmental Impact Assessment in a Transboundary Context (Kiev, 2003) The protocol was approved by Commission Decision 2008/871/EC (OJ L 308, 19.11.2008, p. 33) [3] Directive 2001/42/EC of the European Parliament and the Council, 27 June 2001, about the assessment of the effects of certain plans and programs on the environment [4] Yu, Doichinova, Kanchev, I., Miteva, A. and Stoyanova, Z. Management aspects of eco-economic preparation of students at the University of National and World Economy, University Publishing "Economy", S., 2010

ISSN: 2247-6172 Review of Applied Socio- Economic Research (Volume 9, Issue 1/ 2015), pp. 102 URL: http://www.reaser.eu e-mail: editors@reaser.eu [5] http://sea.unu.edu/course/index.html%3Fpage_id=31.html; [6] http://sea.unu.edu/course/index.html%3Fpage_id=41.html [7] http://sea.unu.edu/course/?page_id=59 [8] http://sea.unu.edu/course/index.html%3Fpage_id=32.html; [9] http://sea.unu.edu/course/?page_id=32 [10] http://sea.unu.edu/course/index.html%3Fpage_id=112.html [11] http://www.scotland.gov.uk/Publications/2006/09/13104943/17 [12] SEA Practical Guide, September 2005 [13] Environmental Report for 'A Forward Strategy for Scottish Agriculture: Next Steps', 2007 [14] http://www.scotland.gov.uk/Publications/2007/01/29131428/11 [15] http://www.scotland.gov.uk/Publications/2007/01/29131428/16

ISSN: 2247-6172 Review of Applied Socio- Economic Research (Volume 9, Issue 1/ 2015), pp. 101 URL: http://www.reaser.eu e-mail: editors@reaser.eu

Changes of marital status: a 1991-2012 comparative analysis in member states of the European Union Simona Maria Stanescu1 ď&#x20AC;Ť 1

Research Institute for Quality of Life, Romanian Academy

Abstract. The aim of this cross-national comparative research is to identify the profile of marital statuses distribution within the member states of the European Union. The paper brings empirical evidence on a horizontal perspective at the level of the years 1991 (EU-15), 2003 (11 countries), and 2012 (14 countries) as well as a vertical dimension: 1991-2003 (four countries), 2003-2012 (six countries), and 1991-2012 (seven countries). The selection of years was due to the longest period of time covered with comparable Eurostat data. Recommendations for further consolidation of Eurostat database on population by marital status are included.

Key words: sociology of family, marital status, European Union JEL Codes: A 14, Z 13, Z 18.

1.

Introduction

Current families are challenges by labour market participation of women, gender distribution, life style, increased time dedicated to education, postponement of marriage and decision to have children, family support policy, and liberalisation of abortion policies [1], [2], [3], [4], [5], [6], [7]. Research on families emphasise two opposite contradictory movements: its privatisation alongside larger publicity [8].

Case studies on assortative mating when choosing a spouse emphasised the role of education system as a marriage market, the decision model of marital choice, changes of gender-specific preferences, and mechanisms of social origin [9]. American studies on reasons for choosing a single life includes: shifting values encouraging singlehood (reality versus idealized images of marriage, growth and change versus culturally set roles, great expectations versus settling for something less), growing number of practical alternatives (womenâ&#x20AC;&#x2122;s changing economic and social needs, anonymity of sexual freedom, convenience) [10]. The paper contributes to cross-national comparative analysis of current distribution of marital statuses.

2.

Methodology

The paper is based on secondary analysis of population by marital status Eurostat data, the statistical office of the European Union (EU). The paper is part of a post-doctoral programme focus on social policy changes underwent as outcome of the EU accession. In this respect, the EU-28 member states are analysed by three categories: EU founder states1, other old member states than the EU founders2 (first four accession wave countries); and Central and East European (CEE) member states (last two accession wave countries)3. ď&#x20AC;Ť

Corresponding author. Tel.: + 402138241; fax: +40213182462.

E-mail address: simona.stanescu@iccv.ro 1 In alphabetic order: Belgium, France, Germany, Italy, Luxembourg, and The Netherlands.

2 In both chronologic order of EU accession, and alphabetic in case of the same EU accession year: Denmark, Ireland, and the United Kingdom (1973); Greece (1981); Portugal, and Spain (1986); Austria, Finland, and Sweden (1995).

3 The fifth EU accession wave: Cyprus, Estonia, Latvia, Lithuania, Malta, Poland, Czech Republic, Slovakia, Slovenia, and Hungary (2004); Bulgaria and Romania (2007); and the sixth accession wave: Croatia (2013).

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Due to available data limitations, the original intention to analyse the marital status change in EU member states was transformed to horizontal analysis for: 1991 (EU-15), 2003 (11 countries), and 2012 (14 countries). Marital dynamic is researched for two separate decades: 1991-2003 (four countries), and 20032012 (six countries), and for two consecutive decades 1991-2012 (seven countries). The selection of years 1991 and 2012 was done in order to cover the largest period of time. As a limit of the research, data are not available for all EU member states or for the same countries in selected years. Consequently, conclusions only apply for the countries referred to in the paper. Per category of member states, the 1991-2003 analysis covers three EU founders (Belgium, France, and Germany), and one other old member state then the EU founders (Sweden). The 2003-2012 section is focus on six CEE member states; Slovenia, Lithuania, Slovakia, Hungary, Czech Republic, and Romania. The 1991-2012 part refer to four EU founders (France, Germany, Italy, and The Netherlands), and three other old member states (Denmark, Finland, and Sweden).

1991 database includes five categories of marital status: “single persons” (never in legal union); “married persons”; “widowed persons”; “divorced persons”; and “separated persons”. Only Spain and Italy registered ”separated persons” in 1991. A further harmonisation of this definition would either allow for more accurate data collection, either would support the adjustment of marital categories. All 1991 marital categories were kept in 2003 and 2012 Eurostat databases. Four new categories were added: “persons in registered partnership”; “persons whose legal union ended with the death of the partner”; “persons whose legal union was legally dissolved”, and “persons with unknown marital status”. “Persons in registered partnerships” were only recorded in 2012 in five out of 14 analysed countries. No data for “persons whose legal union ended with the death of the partner”; or “persons whose legal union was legally dissolved” were registered in 2003, and in 2012. “Persons with unknown marital status” were recorded in 2003 only in Slovenia, and in 2012 in metropolitan France. Only Italy registered “separated persons” in 2012. The total population for each EU member state was only recorded in 1991 and is composed exclusively by the analysed marital categories. We recommend the addition of the total population in 2003 and 2012 alongside info on people not answering and of people not knowing the answer.

3.

Marital statuses in EU member states in 1991, 2003 and 2012

Available 1991 data is focus on EU-15. 2003 includes four EU founders (Belgium, France, Germany, and the Netherlands); one other old member states than the EU founders (Sweden); and six CEE countries (Czech Republic, Hungary, Lithuania, Romania, Slovakia, and Slovenia). Available 2012 data covers four EU founders (France, Germany, Italy, and the Netherlands); three other old member states (Finland, Denmark, and Sweden); and seven CEE countries (Czech Republic, Hungary, Latvia, Lithuania, Romania, Slovakia, and Slovenia). Six CEE countries (Bulgaria, Croatia Cyprus, Estonia, Malta and Poland) are not included in Eurostat data base. Further consolidation of Eurostat data base with data on current missing years and EU member states will support an extended European comparative analysis.

3.1.

Marital statuses in 1991 in EU-15

The research is focused on Western European countries: on the six EU founders (Belgium, France, Germany, Italy, Luxembourg, and The Netherlands), and all nine other old member states (Denmark, Ireland, United Kingdom, Greece, Portugal, Spain, Austria, Finland, and Sweden). The most frequent distribution of marital status (114 countries) includes (by decreasing order): married persons, single, widowed, divorced, and separated. Three countries5 registered the distribution: separate persons, married, widowed, and divorced. Only Sweden had the profile: single persons, married, divorced, and widowed.

4

By the total number of population in ascending order: Luxembourg, Austria, Belgium, Portugal, Greece, The Netherlands, Spain, United Kingdom, France, Italy and Germany 5 By the total number of population in ascending order: Ireland, Finland and Denmark

Millions

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90 80 70 60 50 40 30 20 10 0 LU

IE

FI

DK Total

AT Single

SW

BE

Married

PT

EE

Widowed

NL

ES

Divorced

UK

FR

IT

DE

Separated

Fig. 1: Distribution of population by marital status in 1991 for 15 EU Member States Source: Eurostat database Population by sex, age and marital status

The first frequent marital status in 1991 was “married persons” in eleven EU member states and “single persons” in four countries. The lowest percent of married persons was in Ireland (38% of the total population) and the highest in Greece (52%). Four pairs of countries had the same percent of married people: Austria and France (45%); The Netherlands and United Kingdom (47%); Luxembourg and Spain (48%) and Belgium and Italy (50%). Germany had the lowest percent of single persons (38%) and Ireland the highest (55%). Two pairs of countries had a similar percent of single persons as percent of the total population: Denmark and France (45%), and Finland and Sweden (46%). No commonly shared values of single and married people were identified. Still slight differences were noticed for three pairs of countries:  Spain, and France: 45% and 47% single persons, 45% married persons;  Italy and Portugal: 41% and 50% single persons, 51% married persons;  The United Kingdom, and the Netherlands: 43% single persons, and 47% and 41% married,; Within the eleven EU member states with a higher number of married persons than single ones, the smallest difference was in Spain (2%) while the biggest was in Belgium and Greece (12%). In France the number of marriages is slightly higher than that of single persons: 44.75% compared with 44.70%. Three pairs of countries with larger number of married people than single ones registered common differences: Luxembourg, and Italy (8%); Portugal, and Germany (10%), and Belgium, and Greece (12%).

Denmark had the lowest difference with 3% more single persons than the married ones. Ireland had the most dramatic 1991 difference with 18% more singles persons than the married ones. The third position as marital status in 1991 is occupied by widowed persons in all analysed countries. The lowest value was 5% in Ireland. The highest value was 8% recorded in Austria, Belgium, Germany, and Luxembourg.

Divorced persons represent the fourth marital status in EU-15 in 1991. The lowest number was in Spain with 0.4% of the total population. In Denmark and in Sweden the number of widowed persons was equal to the divorced representing 7% of the total population. This represents the highest 1991 value for EU15 divorced persons. The number of widowed persons was (almost) doubled than divorced in Luxembourg, Belgium, France, and Germany. Four pairs of countries sharing common values were identified:  Greece and Italy (7% widowed persons, and 1% divorced);  Denmark and in Sweden (7% widowed persons, and 7% divorced);  Belgium and Luxembourg (8% widowed persons, and 4% divorced);  Austria and Germany (8% widowed persons, and 5% divorced).

Separated persons were only registered in Spain, and in Italy as 1% of the total population. For more details please consult Annex 1 Population EU-15 by marital status as percent of the total population in 1991.

3.2.

Marital statuses in 2003 for 11 EU member states

The research is focused on eleven member states including five Western European countries (four EU founder states – Belgium, France, Germany, and The Netherlands, one other old member state-Sweden); and six CEE member states: Lithuania, Czech Republic, Slovakia, Slovenia, Hungary and Romania. The

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Millions

most frequent distribution (five countries6) of marital statuses by decreasing order was: married persons, single, widowed and divorced. Three countries7 registered the distribution: single persons, married, divorced and widowed. Two countries8 registered the distribution: single persons, married, widowed and divorced.

Croatiaâ&#x20AC;&#x2122;s distribution was: married persons, single, divorced and widowed.

40,0 35,0 30,0 25,0 20,0 15,0 10,0 5,0 0,0 SI

LT

SK

Single persons

SW Married

HU

BE

Widowed

CZ Divorced

NL

RO

FR

DE

Unknown marital status

Fig. 2: Distribution of population by marital status in 2003 for 11 EU Member States Source: Eurostat Population on 1 January by age, sex and legal marital status

The first marital status as percent of the total population was married persons in six countries. The lowest value (35%) was in Sweden, while the highest (48%) in Romania. Four pairs of countries with common percent of married persons were identified: Lithuania and France (41%); Slovenia and Hungary (42%); Slovakia and Belgium (45%); and Czech Republic and Germany (46%).

The second 2003 most frequent marital status was â&#x20AC;&#x153;single personsâ&#x20AC;?. The lowest number was in the Czech Republic (38%) and the highest (50%) in Sweden. Two pairs of countries registered similar values of single persons: Hungary and Romania (40%); and Lithuania, Belgium, and Germany (41%).

The percent of married people as from the total population and single ones was equal (41%) in Lithuania. The most dramatic difference was in Sweden were the percent of single persons was 15% higher than married persons. No pairs of countries sharing common proportions of married compared with single persons were identified in 2003. Yet slightly similar percentage values were recorded in: Belgium (41% of single persons, 45% married); and Germany (41% of single persons, 46% married).

The lowest percent of widowed persons (5%) in 2003 was in The Netherlands while the highest one (10%) was in Hungary. The lowest number of divorced persons (4%) was in Slovenia, and Romania and the highest (10%) in Lithuania. The number of widowed and divorced persons represents almost the same percent in Belgium (7%); and in Czech Republic (8%). In Romania the number of widowed persons was double than divorced ones, and almost double in Slovenia. One pair of countries sharing the same values was identified: Slovakia and France with 7% widowed persons compared with 5% divorced. For more details please consult Annex 2 Population by marital status as percent of the total population in 2003.

3.3.

Marital status in 2012 for 14 EU member states

This section is focused on four EU founder states (Germany, France, Italy and The Netherlands); three other old member states (Denmark, Finland and Sweden), and seven CEE countries (Czech Republic, Hungary, Lithuania, Latvia, Slovenia, Slovakia and Romania). The most frequent distribution of marital statuses by decreasing order was: single persons, married, divorced, widowed, in registered partnership and separated (seven countries9). Three countries10 had the distribution: married persons, single, widowed, and

6

By the total number of population in ascending order: Slovakia, Hungary, Belgium, Romania and Germany By the total number of population in ascending order: Lithuania, Sweden and the Netherlands 8 By the total number of population in ascending order: Slovenia and France 9 By the total number of population in ascending order: Latvia, Slovakia, Finland, Denmark, Hungary, Sweden, and the Netherlands.

10 By the total number of population in ascending order: Lithuania, Romania, and Italy.

7

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Millions

separated. Two countries11 registered the distribution: married persons, separate, divorced, and widowed.

Other two countries12 had the distribution: separate persons, married, widowed, and divorced.

40,0 35,0 30,0 25,0 20,0 15,0 10,0 5,0 0,0 LV

SI

LT

Single

SK Married

FI

DK

HU

SW

In registered partnership

CZ

NL

Widowed

RO

Divorced

IT

FR

DE

Separated

Fig. 3: Distribution of population by marital status in 2012 for 14 EU member states Source: Eurostat, Population on 1st of January by age, sex and legal marital status

The first most frequent marital status was single person in nine countries and married one in five.

The lowest percent of single people (38%) was recorded in Romania while the highest (52%) was in Sweden.

Three pairs of countries shared similar proportion of single persons: Latvia and Germany (42%); Slovakia and Hungary (43%), and Denmark, Finland, and the Netherlands (47%).

Among the analysed countries, the lowest value of married people (34%) was in Sweden while the highest one (50%) was in Romania. Three pairs of countries recording similar numbers of married persons as percent of the total population were identified: Finland, France and Latvia (37%); Slovenia and the Netherlands (40%); and The Czech Republic, Germany, Lithuania and Slovakia (42%).

In Germany married people (42.4%) was similar single people (42.3%). The lowest value of divorced rates (5%) was in Romania while the highest (12%) was in Latvia. No divorced persons were recorded for 2012 in Italy. Three pairs of countries sharing the same percent of divorced persons were identified: France and Slovenia (6%); Denmark and Germany (8%); and Finland and Sweden (10%).

Denmark, Finland, The Netherlands, and Sweden scored the smallest values (5%) of widowed persons. The highest percent of 10% was recorded in Lithuania and Hungary. Three pairs of countries sharing common values of widowed persons were identified: Czech Republic, Germany, Slovakia, and Slovenia (7%); Italy and Romania (8%); and Hungary and Lithuania (10%).

The most dramatic difference between widowed and divorced persons was in Sweden where divorced persons were by 5% more. One pair of countries (Germany and Slovakia) sharing common values was identified: 8% divorced persons and 7% widowed. The number of divorced and widowed persons was equal in France (6%), and in Hungary (10%). The proportion of divorced persons was double than widowed in Finland and Sweden. The number of widowed persons was almost double than divorced in Romania. For more details please consult Annex 3 Population by marital status as percent of the total population in 2012.

4.

Dynamics of marital statuses for the period 1991-2012

This section includes three parts: 1991-2003 (Belgium, France, Germany, and Sweden), 2003-2012 (Czech Republic, Hungary, Lithuania, Slovakia, Slovenia, and Romania), and 1991-2012 (The Netherlands, Italy, France, Germany, Finland, Denmark, and Sweden). The comparative analysis for 1991-2012 does not include all analysed EU member states due to lacking information. Further consolidation of Eurostat data with comparative information on all missing member states would allow for a detailed and comprehensive comparative analysis of changes in marital status.

11 12

By the total number of population in ascending order: Czech Republic, and Germany.

By the total number of population in ascending order: Slovenia, and France.

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4.1.

Dynamics of marital status 1991-2003 in four EU member states

Millions

This section is focus on three EU founder states (Belgium, France and Germany), and other old member states than the EU founders (Sweden). Research results are presented by proportion of marital categories from the total population in 1991.

45 40 35 30 25 20 15 10 5 0 SW

SW

BE

BE

FR

FR

DE

DE

1991

2003

1991

2003

1991

2003

1991

2003

Single

Married

Widowed

Divorced

Fig. 4: The 1991-2003 marital changes as percent of the total population Source: Eurostat database Population by sex, age and marital status

Belgium, France and Germany shared in 1991 the marital distribution: married persons, single, widowed and divorced. At the opposite end is Sweden with: single persons, married, divorced and widowed.

Data for 2003 shows different four marital profiles in analysed countries.

MSWD BE, FR, DE DE

1991 2003

MSDW

SMWD

BE

SMDW SW SW

FR

Tab. 1: Country profiles by decreased distribution of marital status Source: Authorâ&#x20AC;&#x2122;s calculation based on Eurostat database Population by sex, age and marital status M=married persons S=single (never in a legal union) W=widowed D=divorced

No commonly shared profile for the period 1991-2003 was identifiable. With slight differences per proportion of marital category as percent of the total population, Sweden and Germany preserve their domestic distribution. Belgium maintained the first two positions (married and single), but switched in 2003 the rankings between divorced and widowed people. France switched in 2003 the rankings for single with married persons but kept the same order as top position for both widowed and divorced persons.

As 1991-2003 changes of marital status as percent of the total population, common trends were identified. Single and divorced persons increased, while the number of married people decreased.

5% 4% 3% 2% 1% 0% -1% -2% -3% -4% -5% -6%

4%

3% 2%

3%

2%

2%

2% 1%

-1%

SW

BE

FR

-1%

DE

-3% -5%

-4%

-5% Single persons

Married

Widowed

Divorced

Fig. 5: Marital changes for the period 1991-2003 as % of the total population Source: Authorâ&#x20AC;&#x2122;s calculation based on Eurostat database Population by sex, age and marital status

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The most dramatic 1991-2003 negative changes was for married people in Sweden and Belgium where it decreased in 2003 by 5% of the total population. The top 1991-2003 positive change was in Sweden with an increased 4% of single people. Slight 1991-2003 changes were recorded for widowed person. No changes of their proportion were recorded neither in Belgium or France. In both Sweden and Germany the number of widowed persons decreased with 1%.

4.2.

Dynamics of marital status 2003-2012 in six EU member states

Millions

This section is focus on six member states from the fifth EU enlargement wave: Czech Republic, Hungary, Lithuania, Slovakia, Slovenia, and Romania. Research results are presented in increasing order by the 2003 population. Further consolidation of Eurostat database with information for 2003 Latvia, and 2003 and 2012 data for new EU member states (Bulgaria, Croatia, Cyprus, Estonia, Malta, and Poland) would allow for further comparative analysis. Single and married persons were the most frequent marital status and kept their order in the top positions in 2012 compared with 2003 in Czech Republic, Slovenia and Romania.

In Hungary, Lithuania and Slovakia the two marital statuses switched their top positions.

12,0 10,0 8,0 6,0 4,0 2,0 0,0 SI

SI

LT

LT

SK

SK

HU

HU

CZ

CZ

RO

RO

2003

2012

2003

2012

2003

2012

2003

2012

2003

2012

2003

2012

Single persons

Married

Widowed

Divorced

Fig. 6: The 2003-2012 marital changes as percent of the total population Source: Eurostat database Population by sex, age and marital status

The most frequent 2003 distribution of marital statuses in three out of six analysed countries was (in decreasing order): married people, single, widowed and divorced. In 2012 a pair of two countries shared this distribution while another pair of two countries registered: single, married, divorced, and widowed persons.

Czech Republic and Slovenia kept the same marital profile in 2003 and 2012.

2003 2012

MSWD SK, HU, RO LT, RO

MSDW CZ CZ

SMWD SI SI

SMDW LT SK, HU

Tab. 2: Country profiles by decreased distribution of marital status Source: Authorâ&#x20AC;&#x2122;s calculation based on Eurostat database Population by sex, age and marital status M=married persons S=single (never in a legal union) W=widowed D=divorced

No commonly shared dynamic profile for 2003-2012 was identified. Romania, Czech Republic and Slovenia maintained the same marital profile. The remaining three countries switched between both the first and the second top positions, and the third and fourth one. Slovakia and Hungary shared similar marital change directions in 2003 compared with 2012. Lithuania registered two opposite marital profiles as none of the fourth marital statuses kept its position in 2012 compared with 2003.

As common directions, except for Lithuania, the number of divorced people increased. Proportion of widowed was constant except for Lithuania (2% more in 2012), and for the Czech Republic (1% more in 2012). Growing number of single people and decreased married persons were recorded in Slovenia, Hungary and Czech Republic. The number of married people increased while singles decreased in Lithuania and in Romania. Only in Slovakia, the number of 2012 married people was lower compared with 2003.

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4% 3%

3% 2% 2%

3%

2%

2%

3% 2%

2%

2%

1%

1%

1% 0% SI

-1%

LT

SK

HU

CZ

-1%

-2% -2%

-3%

RO

-1%

-2%

-2% -3%

-4%

-4%

-5% Single persons

Married

-4%

Widowed

Divorced

Fig. 7: Marital changes for the period 2003-2012 as % of the total population Source: Authorâ&#x20AC;&#x2122;s calculation based on Eurostat database Population by sex, age and marital status

The most dramatic negative change was in Hungary and Czech Republic with -4% married people in 2012. The highest value of positive marital changes was in Slovakia and Czech Republic with 3% more divorced people in 2012. Hungary registered 3% more single persons in 2012. Widowed persons scored the lowest variations. No 2003-2012 differences were noticed in Slovenia, Slovakia, Hungary and Romania.

4.3.

Dynamics of marital status 1991-2012 in seven EU member states

Millions

The analysis refers to four EU founders (The Netherlands, Italy, France and Germany), and three other old member states (Finland, Denmark and Sweden). As methodology, we overviewed the distribution of marital status in 1991 and in 2012, we analysed these differences as percent of the total population and compared the changes in the distribution of the marital status. Complementary available 2003 data were used for France, Germany, The Netherlands, and Sweden.

45 40 35 30 25 20 15 10 5 0 FI

FI

DK

DK

SW

SW

NL

NL

IT

IT

FR

FR

DE

DE

1991

2012

1991

2012

1991

2012

1991

2012

1991

2012

1991

2012

1991

2012

Single

Married

Widowed

Divorced

Fig. 8: The 1991-2012 marital changes as percent of the total population Source: Eurostat database Population by sex, age and marital status

The most frequent 1991 distribution of marital status was (in decreasing order): married people, single, widowed and divorced. The most frequent 2003 and 2012 distribution was: single, married, divorced, and widowed. In other words, no single marital status kept its position in the top. The domestic profile of single persons, married, widowed, and divorced was in 1991 in Finland and Denmark and in 2003 and 2012 in France. As new 2012 entry, Germany registered: married persons, single, divorced, and widowed.

1991 2003 2012

MSWD NL, FR, IT, DE DE IT

MSDW DE

SMWD FI, DK FR FR

SMDW SW NL, SW FI, DK, SW, NL

Tab. 3: Country profiles by decreased distribution of marital status Source: Source: Authorâ&#x20AC;&#x2122;s calculation based on Eurostat M= married persons S=single (never in a legal union) W=widowed D=divorced

ISSN: 2247-6172 Review of Applied Socio- Economic Research (Volume 9, Issue 1/ 2015), pp. 109 URL: http://www.reaser.eu e-mail: editors@reaser.eu

The 1991-2012 research outputs do not support the idea of a common marital change dynamic. Two countries (Italy and Sweden) preserved the same profile in 2012 compared with 1991.

Germany, Finland, and Denmark maintained the same order of the two top positions (single and married persons), but switched the third and the fourth ones (widowed and divorced persons). France kept the third and fourth marital positions (widowed and divorced persons), but switched the first two positions (married and single persons). In the case of The Netherlands, all four marital statuses changed their positions in 1991 compared with 2012. This change happened since at least 2003 (as data are not available for other years covering the period between 1991 and 2003). The 2012 marital profile was changed since 2003 in France, and The Netherlands but not in Germany. Collection of 2003 marital statuses related data for Finland, Denmark and Italy could have been providing useful complementary information.

As common trends, the number of married persons decreased, while the number of single grew. Save for Italy, widowed persons decreased and the number of divorced persons increased.

8% 6% 6%

5% 4%

4%

4%

3%

4% 3%

3%

3%

2% 2%

2% 1%

1%

0% -2%

-1% -2%

DK

FI

-1%

-2%

NL

DE -1%

-1% -1%

IT

FR -1%

SW -2%

-4% -5%

-6%

-6%

-6%

-7%

-8%

-8% -10% Single

Married

Widowed

Divorced

Fig. 9: Marital changes for the period 1991-2012 as % of the total population Source: Authorâ&#x20AC;&#x2122;s calculation based on Eurostat database Population by sex, age and marital status

The highest value of a negative marital change was in France where the number of divorced people decreased by 8% in 2012 compared with 1991. The highest value of a positive marital change was in Sweden where the percent of single people increased in 2012 by 6% in comparison with 1991. Widowed persons registered the smallest variations in 2012 compared to 1991. The only unchanged marital status was the single persons in Italy. The analysis of the potential objective constraints or personal reasons behind these changes in marital statuses is not the topic of the current paper but it could be further developed.

5.

Conclusions

The initial research aim to analyse changes of marital statuses in EU member states was redesigned due to available data. In this respect, a part of the paper is focus on marital statuses in 1991, 2003, and 2012 while the second part is focus on changes occurred between 1991-2003, 2003-2012, and 1991-2012.

The most widespread EU-15 marital status in 1991 in decreasing order of frequencies as percent of the total population was: married people, single, divorced, widowed, and separate persons. Married people was the first marital status in eleven countries: the six EU founders (Belgium, Germany, France, Italy, The Netherlands, and Luxembourg), and five other old member states (Austria, Greece, Spain, Portugal, and United Kingdom). The highest percentage of married people (52% of the total population) was in Greece.

Single persons was the first marital status in 1991 in four EU member states: Denmark, Finland, Ireland, and Sweden. Ireland registered both the lowest percent of married people (38%) and the highest value of single ones (55%). Lowest percent of single persons (38%) was in Germany. Widowed persons represented in 1991 the third marital status in EU-15 except for Sweden. The smallest percent of widowed persons (5%) was in Ireland while the highest (8%) was in Austria, Belgium, Germany, and Luxembourg. Divorced persons represented the fourth marital status except for Sweden. The lowest number of divorced people (0.4%) was in Spain while the highest (7%) was in Denmark and in Sweden.

ISSN: 2247-6172 Review of Applied Socio- Economic Research (Volume 9, Issue 1/ 2015), pp. 110 URL: http://www.reaser.eu e-mail: editors@reaser.eu

The most frequent 2003 distribution of marital status in 11 EU member states was, by decreasing order of frequencies: married persons, single, widowed, and divorced. Married represented the first marital status in six countries: two EU founders (Belgium and Germany), and four CEE countries (Slovakia, Hungary, Romania and Czech Republic). The lowest value (35%) was registered in Sweden while the highest (48%) in Romania. Single persons represented the first marital status in five countries: France, The Netherlands, Sweden, Slovenia, and Lithuania. Czech Republic registered the lowest (38%) value of single people while Sweden the highest (50%). Widowed persons represented the third position in six countries: France, Germany, Slovakia, Hungary, Romania, and Slovenia. The lowest value of widowed persons (5%) was recorded in The Netherlands, while the highest (10%) in Hungary. Divorced persons represented the third position in five EU member states: Belgium, The Netherlands, Sweden, Czech Republic, and Lithuania.

The lowest percent (4%) was in Romania and Slovenia and the highest (10%) in Lithuania.

The 1991-2003 research of marital status was focus on four EU member states: Belgium, France, Germany, and Sweden. As common trends, the number of married persons decreased while single and divorced ones increased. The proportion of widowed persons remained constant in Belgium and France and decreased in Sweden and Germany. As 1991-2003 dynamic, Germany and Sweden kept their distribution of marital statuses. As top marital positions as percent of total population, France switched in 2003 married persons with single ones, while Belgium switched in 2003 divorced with widowed persons.

The 2003-2012 research included six countries: Czech Republic, Hungary, Lithuania, Slovakia, Slovenia, and Romania. The number of married people decreased and single ones increased except for Lithuania and Romania. Divorced persons increased except for Lithuania. The proportion of widowed persons remained constant except for Lithuania and Czech Republic where it decreased. Romania, Czech Republic and Slovenia kept their distribution of marital statuses. Lithuania on one hand and Hungary and Slovakia on the other hand switched their marital distribution in 2012 compared with 2003.

The 1991-2012 analyse of marital status was focus on seven EU member states: The Netherlands, Italy, France, Germany, Finland, Denmark, and Sweden. As common trends, the number of married and widowed persons decreased while single and divorced increased. As an exception, in Italy the proportion of divorced persons decreased, widowed people increased and no single person was registered in 2012. The most frequent distribution of marital status in 1991 was shared by four countries (The Netherlands, France, Italy, and Germany): married persons, single, widowed and divorced. The most frequent 2012 distribution was shared by four countries (The Netherlands, Finland, Denmark, and Sweden): single persons, married, divorced and widowed. Sweden is the only country which kept the same distribution of marital status in 1991, 2003 and 2012. The same marital profile was registered in Germany (1991 and 2003), in France (2003 and 2012), and The Netherlands (2003 and 2012). France and The Netherlands switched the first top position of married in 1991 with single in 2012. Germany, Finland, and Denmark switched the third position of widowed in 1991 with divorced in 2012.

A further consolidation of Eurostat database with data on all EU member states starting with at least their accession to the EU would allow consolidation of obtained research results. In this respect, we recommend conceptual clarifications of categories of marital status used (i.g. single persons, widowed versus persons whose legal union ended with the death of the partner). However in 2003 and 2012 no data were recorded for the categories of “Persons whose legal union ended with the death of the partner”, “Persons whose legal union was legally dissolved”, and “Separated persons”. In this respect, a methodological decision should be taken about the appropriateness to maintain them in future databases. The harmonisation of “registered partnership” among EU member states is to be further prospected. We recommend that total population per country will be included alongside explanations for non-answers, and don’t know answers.

As future research, identification of trends in marital status will support the investigation of the impact of different demographic scenarios within the EU member states on a long term perspective (2020, 2040, and 2060) and consequent adjustment of EU and domestic regulations in the field of social policy.

ISSN: 2247-6172 Review of Applied Socio- Economic Research (Volume 9, Issue 1/ 2015), pp. 111 URL: http://www.reaser.eu e-mail: editors@reaser.eu

6.

Acknowledgement

The work of Simona Maria Stanescu is elaborated and published under the auspices of the Institute for the Research of the Quality of Life Romanian Academy, as part of the project co-financed by the European Union by the Sectoral Operational Programme Human Resources Development 2007‒2013, within the Project Pluri-and Inter-disciplinarity in Doctoral and Post-Doctoral Programmes Project Code POSDRU/159/1.5/S/141086.

7.

References

[1] Mihailescu, I. Familia in Zamfir, C., and Vlasceanu L. (eds.) Dictionar de sociologie, Babel Publisher, Bucharest, 238-245 [2] Popescu, R.. Introducere în sociologia familiei Familia româneasca în societatea contemporana, Polirom, Iasi, 2009.

[3] Muresan, C. Postponement of Motherhood in Romania: The Role of Educational Attainment. Revista de Cercetare si Interventie Sociala, 47, 2014, 137-149.

[4] Stanescu, I. Romania: a non-internetionist family support policy? Mediteranean Journal of Social Sciences, vol. 5, no. 19, pp. 19-24 [5] Stanescu, S. Back to work with small children Comparative analyses of Maternity / paternity leave in the membr states of the European Union, Mediteranean Journal of Social Sciences, vol. 6, no. 2 S5, pp. 363-375 [6] Stanescu, S., Nemtanu, M. Family benefits I member states of the European Union: a comparative perspective, European Journal of Applied Sociology, 2015.

[7] Stanescu, S., M. Nemtanu, Comparative analysis of abortion liberalisation in the European Union, Revista Calitatea Vietii, 2015.

[8] Seganel, M.. Sociologia familiei, Iasi, Polirom, 2011, pp. 408 [9] Blossfeld, H. P.,Timm, A. Who Marries Whom? Educational Systems as Marriage Markets in Modern Societies, European Association for Population Studies, Kluwer Academic Publishers, 2003. p. 3-12 [10] Bird, G., Melville, K. Families and Intimate Relationship, McGraw-Hill, United States of America, 1994. p. 118120

ISSN: 2247-6172 Review of Applied Socio- Economic Research (Volume 9, Issue 1/ 2015), pp. 112 URL: http://www.reaser.eu e-mail: editors@reaser.eu

8.

Annexes

Annex 1. Population EU-15 by marital status as percent of the total population in 1991 No. Country Single persons Married person Widowed persons Divorced persons Separated persons 1.

Luxembourg 40 % 48 % 8% 4% 0% 2.

Ireland 55 % 38 % 5% 2% 0% 3.

Finland 45 % 42 % 7% 6% 0% 4.

Denmark 45 % 41 % 7% 7% 0% 5.

Austria 42 % 45 % 8% 5% 0% 6.

Sweden 46 % 40 % 7% 7% 0% 7.

Belgium 39 % 50 % 8% 4% 0% 8.

Portugal 41 % 51 % 6% 2% 0% 9.

Greece 40 % 52 % 7% 1% 0% 10. The Netherlands 43 % 47 % 6% 4% 0% 11. Spain 45 % 48 % 6% 0% 1% 12. United Kingdom 41 % 47 % 7% 5% 0% 13. France 44.6 % 44.7 % 7% 3% 0% 14. Italy 41 % 50 % 7% 1% 1% 15. Germany 38 % 49 % 8% 5% 0% Source: Author’s calculation based on 1991 Eurostat data base Population by sex, age and marital status Annex 2. Population by marital status as percent of the total population in 2003 No. Country Single persons Married person Widowed persons Divorced persons Unkown marital status 1.

Slovenia 46 % 42 % 7% 4% 1% 2.

Lithuania 41.3 % 40.5 % 8% 10 % 0% 3.

Slovakia 43 % 45 % 7% 5% 0% 4.

Sweden 50 % 35 % 6% 9% 0% 5.

Hungary 40 % 42 % 10 % 8% 0% 6.

Belgium 41 % 45 % 7% 7% 0% 7.

Czech Republic 38 % 46 % 8% 8% 0% 8.

The Netherlands 45 % 44 % 5% 6% 0% 9.

Romania 40 % 48 % 8% 4% 0% 10. France 47 % 41 % 7% 5% 0% 11. Germany 41 % 46 % 7% 6% 0% Source: Author’s calculation on 2003 Eurostat data base Population by age, sex and legal marital status Annex 3. Population by marital status as percent of the total population in 2012 In registered Widowed Divorced No. Country Single persons Married person partnership persons persons Latvia 42% 37% 0% 9% 12 % 1.

Slovenia 48 % 40 % 0% 7% 6% 2.

Lithuania 39 % 42 % 0% 10 % 9% 3.

Slovakia 43 % 42 % 0% 7% 8% 4.

Finland 47 % 37 % 0.1 % 5% 10 % 5.

Denmark 47 % 39 % 0.2 % 5% 8% 6.

Hungary 43 % 38 % 0% 10 % 10 % 7.

Czech Republic 40 % 42 % 0% 7% 11 % 8.

Sweden 52 % 34 % 0% 5% 10 % 9.

47 % 40 % 0.8 % 5% 7% 10. The Netherlands 38 % 50 % 0% 8% 5% 11. Romania 41 % 49 % 0% 8% 0% 12. Italy 50 % 37 % 0% 6% 6% 13. France 42.2 % 42.4 % 0% 7% 8% 14. Germany Source: Author’s calculation on 2012 Eurostat data base Population by age, sex and legal marital status

Separated persons 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 0% 2% 0% 0%

ISSN: xxx-x-xxx-xxx-x Review of Applied Socio- Economic Research (Volume 9, Issue 1/ 2015), pp. 113 URL: http://www.reaser.eu e-mail: editors@reaser.eu Annex 4. The distribution of analysed EU member states by available data EU founder states Other old member states than the EU founders BE DE FR IT NL LU AT DK EE ES FI IE PT SW UK 1991 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 2003 1 1 1 1 1 2012 1 1 1 1 1 1 1 Source: Eurostat data base Population by age, sex and legal marital status

CZ 1 1

HU 1 1

CEE member states LT LV SI 1 1 1 1 1

SK 1 1

RO 1 1

Annex 5. Distribution of marital profiles MSWD MSDW SMWD EU FS Oth MS CEE MS EU FS Oth MS CEE MS EU FS Oth MS CEE MS EU FS 1991 BE, DE, FR, IT, NL, LU AT, EE, ES, PT, UK DK. FI, IE 2003 DE SK, HU, RO BE CZ FR SI NL 2012 IT LT, RO DE CZ FR SI DE, FR, IT, NL Source: Authorâ&#x20AC;&#x2122;s calculation based on Eurostat database Population by sex, age and marital status M= married persons S=single (never in a legal union) W=widowed D=divorced EU FS = EU founder states Oth MS= Other old member states than the EU founders CEE MS=CEE member states

SMDW Oth MS CEE MS SW SW LT FI, DK, SW LV, SK, HU