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Unique EBRD survey sheds light on the impact of change on people’s lives

By Anthony Williams

Largest poll of its kind assesses life satisfaction, role of corruption and the gender divide; provides insight on impact of crisis in Greece

A new report from the European Bank for Reconstruction and Development (EBRD) shows growing levels of life satisfaction across the former communist bloc, generally decreasing but continuing concerns about corruption and a persistent gender divide in the labour markets and in business.

The report is the third in a series of Life in Transition Surveys (LiTS) that the EBRD has produced since 2006.

Read Life in Transition survey III in full online

They are large-scale and comprehensive surveys focusing on beliefs, perceptions and attitudes of individuals and households, providing invaluable insight into how peoples’ lives have been shaped by change and upheaval since the fall of communism.

In the largest survey so far, the EBRD together with the World Bank polled 51,000 households in 34 countries*, mainly “transition countries” in central and eastern Europe as well as Turkey and also, for the sake of comparison with more prosperous western neighbours, from Germany and Italy. For the first time, the survey also covered Cyprus and Greece.

A sobering chapter on Greece reveals just how hard the people of that country were affected by its recent economic crisis. It shows the various ways in which they coped with the impact of the crisis and provides an insight into their expectations for the future.

In a section on life satisfaction, parts of which have already been reflected in the EBRD’s recently published Transition Report, “Equal Opportunities in an Unequal World”, the survey showed satisfaction levels had increased compared to 2006 and 2010 and were converging with more prosperous western European countries.

People’s responses showed them to be more tolerant of ethnic and sexual minorities than they were in 2010, although less so than respondents in Germany and Italy. The report also indicated that they had become slightly less tolerant of immigrants.

By assessing the hopes, fears and aspirations of ordinary people, LiTS is a key tool that helps make sure that the work of the EBRD is aligned with the requirements of the countries where it invests and the people who live there.

In his foreword to the latest survey, EBRD Chief Economist Sergei Guriev explains that the economic hardship that transition has entailed has led to some disillusionment and sometimes a slowdown or reversal of reforms, a trend that has underscored the importance of assessing reform not just in terms of economic growth or levels of private ownership.

“Reforms are, after all, intended to enhance the well-being of the general public. If the public does not see the benefits of the reforms, they will ultimately not be successful,” he writes.

The second chapter of the latest LiTS report focuses on corruption, an area where the EBRD has persistently fought for improvements via support for government reforms and in the conditions on its own investment.

The survey shows that people’s perceptions and actual experiences of corruption have decreased since 2006 but are still higher than in comparative western European countries. There are also marked regional differences. The level of trust in institutions is generally high in Central Asia and south-eastern Europe and low in eastern Europe and the Caucasus.

Overall, the report reveals that people tend to trust their police, armed forces, president or prime minister, and religious institutions while only about two-fifths of respondents have confidence in their government.

The survey also highlights a strong correlation between corruption levels and progress in areas such as the freedom of the press, effectiveness of democracy, governance and the rule of law. “…respondents in democratic countries tend to report fewer experiences of corruption than their counterparts in less democratic countries.”

The chapter on gender reveals roughly similar levels of education between men and women but again with regional difference. Some 10 per cent of women and 15 per cent of men have been in tertiary education in Azerbaijan and Serbia while the split is 26 per cent for women and 30 per cent for men in the Kyrgyz Republic, Mongolia and Poland.

Despite some narrowing of the education divide, the report shows that women are less engaged in the workforce than men. Furthermore, women’s education could be limited in cultures where marrying and starting a family at an early age is the social norm.

Women are also less likely to be in full-time employment and bear a disproportionate share of the housework and care of children and relatives.

There are fewer businesswomen in the transition region compared with Germany and Italy and there has been no significant increase since 2010. While both men and women often cite insufficient funding as the main barrier to setting up a business, more women than men fail to get a business started due to changes in their personal situations, such as having a child.

The report makes an economic case for more women in the workforce, noting that obstacles to full participation of women in the labour market and decision-making at household, corporate and political levels mean “a great volume of economic potential remains untapped”.

However, it also notes that in Russia, eastern Europe and the Caucasus and Central Asia most people believe that “it is better for everyone involved if the man earns the money and the woman takes care of the home and children”, a stance that is broadly backed by women in these regions.

It concludes that reforms in family and education laws are needed in order to encourage parents to invest in their daughters’ education and says more steps are needed to bring women into higher education, particularly in science and technology, and improve their employment prospects.

The latest LiTS report shows that the impact of the economic crisis on Greek households has been deep and widespread, taking a greater toll on people than was unleashed by the global recession that began in 2008-09 on the people of central and eastern Europe.

Over 92 per cent of Greek respondents say the crisis affected them “a fair amount” or “a lot”, while 76 per cent of them experienced a negative income shock between 2010 and 2016, compared with one in two households in the transition region and about one in three in the western European comparator countries in 2008-10.

“Compared to eastern European households interviewed as part of LiTS II in 2010 (who also reported a deep impact of the recent crisis), Greeks have had to resort to cutting the consumption of necessities, non-necessities and services to a greater extent,” the report says.

The survey revealed a widespread distrust of national political institutions in Greece, with around 70 per cent of respondents blaming political parties for the economic crisis.

After enduring a number of extremely difficult years, the survey shows that Greece has the lowest proportion of respondents satisfied with their lives of all the 34 countries polled.

The picture looking forward for Greeks does not appear much rosier. Only 16 per cent of the respondents in Greece saw their situation improving over the next four years, compared with 48 per cent in post-communist countries and 35 and 23 per cent in Germany and Italy, respectively.

 “This signals that, despite the recent political changes and attempts at economic reforms that have taken place in the country, Greeks do not see their situation improving for the foreseeable future”, the report concludes.

*The “transition region” in this report refers to the EBRD’s countries of operations that are covered in the third round of the Life in Transition Survey (LiTS): Albania, Armenia, Azerbaijan, Belarus, Bosnia and Herzegovina, Bulgaria, Croatia, Estonia, FYR Macedonia, Georgia, Hungary, Kazakhstan, Kosovo, the Kyrgyz Republic, Latvia, Lithuania, Moldova, Mongolia, Montenegro, Poland, Romania, Russia, Serbia, the Slovak Republic, Slovenia, Tajikistan, Turkey, Ukraine and Uzbekistan.

It also includes Cyprus and Greece, which became recipient member countries of the EBRD in May 2014 and March 2015, respectively. The Bank’s involvement in both countries is expected to be temporary, with no new investment after the end of 2020.  

The survey was also implemented in the Czech Republic. Please note that the EBRD ceased making new investments in the Czech Republic in 2007 but still manages a portfolio in the country.

Western Europe refers to the comparator countries – Germany and Italy – which allow us to benchmark the transition region against some advanced market economies, thereby giving a clearer perspective on the remaining challenges facing transition countries.

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