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1. A BOTTOM UP RESPONSE TO A TOP DOWN CRISIS: A Pan European Perspective PROFESSOR RICHARD ROSE Centre for the Study of Public Policy University of Aberdeen.

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Presentation on theme: "1. A BOTTOM UP RESPONSE TO A TOP DOWN CRISIS: A Pan European Perspective PROFESSOR RICHARD ROSE Centre for the Study of Public Policy University of Aberdeen."— Presentation transcript:

1 1. A BOTTOM UP RESPONSE TO A TOP DOWN CRISIS: A Pan European Perspective PROFESSOR RICHARD ROSE Centre for the Study of Public Policy University of Aberdeen The International Crisis and Post-Communist States University of Glasgow May CSPP RR-eccri-slw-.ppt

2 2. WHERE IS THE CRISIS? Top down macro-economic or bottom-up household? Vulnerable countries An international stimulus: all countries equally affected Macro-economic: a crisis of banks, ministries of finance But vulnerability differs: CEE 10/ Northern 11/Med 6 Vulnerable people Micro-level: poor people, indebted people. All countries have some vulnerable and some secure people but proportions differ. RR-eccri-slw-.ppt

3 NorthernMed.CEE If you are In work; ergo you could become unemployed 50%46% Outside the labour force, you cant be unemployed43%47%42% A pensioner, you have a guaranteed, inflation-proofed income 23%18%24% More educated, less vulnerable 37%18%25% Holding a credit card, you could 46%30%35% have a debt Mortgage holder, you have debts 43%24%13% 3. VULNERABILITY DIFFERS WITH ECONOMIC STATUS Source: Eurobarometer 72.1, 27 EU countries, fieldwork Aug-Sept 2009, unweighted N=26,719 RR-eccri-slw-.ppt

4 NorthernMed.CEE Mean: (standard deviation) Higher GDP ,61819,7839,690 (13,823)(4,778)(3,642) Contraction 2008/9-5.2%-3.4%-8.1% (1.7)(1.5)(5.8) Inflation %2.2%5.4% (0.5)(0.8)(2.7) Looser credit* 43%24%13% * % mortgage holders 4. VULNERABILITY DIFFERS BETWEEN COUNTRIES Sources: Access to credit: Eurobarometer 72.1, D46, 27 EU countries, fieldwork August-September 2009, unweighted N=27,719. Official economic statistics: Eurostat, search_database (accessed 1 April 2010). GDP: nominal Gross Domestic Product per capita in Euro per inhabitant; contraction: growth rate of real GDP per capita; inflation: annual average inflation rate. Averages for groups of countries weight each country equally. RR-eccri-slw-.ppt

5 5. VULNERABLE COUNTRIES AND VULNERABLE PEOPLE HYPOTHESES H 1. If people are low in socio-economic resources, they are worse off. H 2. If people are vulnerable, they are worse off. H 3. If people live in poor countries, they are worse off. H 4. If people live in vulnerable countries, they are worse off. RR-eccri-slw-.ppt

6 6. THE WOUNDED AND THE COPING The Dependent Variable Q 37. Which of the following best describes how your household is keeping up with all its bills and credit commitments at the moment? NorthMed.CEE Difference North-CEE (% respondents) No difficulty Okay but problems from time to time Keeping up a constant struggle Keeping up(97)(93)(92)(5) Falling behind with some bills Real problems, be hind with many bills Falling behind(3)(7) (9)(-6) Source: Eurobarometer 72.1, Q37, 27 EU countries, fieldwork August-September 2009, unweighted N=26,719. Dont knows excluded. RR-eccri-slw-.ppt

7 b Std. ErrorBeta Social status *** Education *** Age *** Male *** Urbanization *** #nmi single space within each of three blocs Employed Unemployed *** Pensioner *** Credit card access *** Mortgage holder THE EFFECT OF LOW RESOURCES, VULNERABILITY Dependent variable: Q # Difficulty paying bills R 2 =27.4% Source: Eurobarometer 72.1, Q37, 27 EU countries, fieldwork August-September 2009, unweighted N=26,719. (*** significant at.001, **.01, *.05 level) RR-eccri-slw-.ppt

8 Coeff.ErrorT-ratio #GDP change 2008/ # see s % with mortgages *** Social status *** Education *** Age *** Male *** Urbanization Unemployed *** Pensioner *** Credit card access *** Sources: Eurobarometer 72.1, Q#fieldwork August-September 2009, 27 EU countries, unweighted N=26,719. #amend/ delete as appropriate. GDP change 2008/9: Eurostat, page/portal/statistics/ search_database, (accessed 1 April 2010) (*** significant at.001, **.01, *.05 level) 8. DIFFICULTIES IN CONTEXT Hierarchical Linear Model: pseudo R 2 =29.7% RR-eccri-slw-.ppt

9 9. IS RUSSIA DIFFERENT COMPARED TO CEE COUNTRIES? CEE Russia mean Keeping up difficult 9%25% GDP change 2008/9-8.1%-7.9% Has mortgage 13%1% Can get credit card, bank 35%40% loan Sources: Eurobarometer 72.1, Q37, fieldwork August-September 2009, 10 CEE countries, unweighted N=10,144; New Russia Barometer XVIII, A6, fieldwork June 2009, unweighted N=1,601. GDP change 2008/9: Eurostat, portal/page/portal/statistics/ search_database (accessed 1 April 2010); for Russia: World Bank, Russian Economic Report No. 21 (March 2010), p.5. RR-eccri-slw-.ppt

10 CEERussia Beta Social status-.41***-.25*** Education-.06***.01 Age-.04**-.03 Male-.03***-.10*** Urbanization.03***-.04 Employed Unemployed.11***.08** Pensioner-.05**.01 Credit card access-.18***-.20*** Mortgage holder.08***-.02 R-squared:28.0%14.4% 10. COMPARING INFLUENCES ON HOUSEHOLD DIFFICULTIES Ordinary least squares regressions Source: Eurobarometer 72.1, Q37, fieldwork Aug-Sept 2009, 10 CEE countries only, unweighted N=10,144. New Russia Barometer XVIII, A6, fieldwork June 2009, unweighted N=1,601. (*** significant at.001, **.01, *.05 level) RR-eccri-slw-.ppt

11 11. HOW MUCH CHANGE IN RUSSIA SINCE BEFORE THE CRISIS ? Q. Do you get enough money from your main source of income to buy what you really need? Difference (% respondents) Definitely enough550 Just enough20200 Not quite enough49501 Definitely not enough Sources: New Russia Barometer XV, A6, fieldwork April 2007, unweighted N=1,606; New Russia Barometer XVIII, A6, fieldwork June 2009, unweighted N=1,601. Dont knows excluded. For a discussion of political effects, see R. Rose and W. Mishler, "The Impact of Macro-Economic Shock on Russians", Post-Soviet Affairs, 26, 1. RR-eccri-slw-.ppt

12 EUROBAROMETER 72.1MinimumMaximumMeanSDev Difficulty keeping up commitments 1 no difficulties5 real problems Unemployed0 no1 yes Pensioner0 no1 yes Credit card access1 very difficult4 not at all difficult Education year stop1 15 or less Male0 female1 male Age15 years Town size1 rural3 large town Mortgage holder0 no1 yes Self-assessed status1 lowest level10 highest VARIABLE LISTS NEW RUSSIA BAROMETER XVIII Difficulty keeping up1 no difficulties4 very difficult Social status1 lowest7 highest Education level1 primary or less8 university Age18 years Male0 female1 male Urbanization1 village5 Moscow Employed0 no1 yes Unemployed0 no1 yes Pensioner0 no1 yes Access to bank credit1 definitely no4 definitely yes Has a mortgage0 no1 yes Sources: Eurobarometer 72.1, fieldwork Aug-Sept 2009, 27 EU countries, unweighted N=26,719. New Russia Barometer XVIII, fieldwork June 2009, unweighted N=1,601; GDP change 2008/9: Eurostat, statistics/ search_database (accessed 1 April 2010). AGGREGATE-LEVEL (EU27) GDP change 2008/9, % % with mortgages RR-eccri-slw-.ppt


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