Standard of Living Factors with Respect to Environment in
Selected European Union Countries
Mgr. Ing. Naďa Birčiaková, Ing. Veronika Antošová, Department of
Marketing and Trade, Mendel University in Brno, e-mail:
[email protected], [email protected]
Abstract
The presented article deals with findings of environmental factors, which influence the
standard of living of inhabitants in the Czech Republic, Finland, France, Spain and the United
Kingdom. The standard of living is assessed on the basis of the GDP per capita and on the
basis of the alternative Happy Planet Index, in the framework of which increased attention is
paid to the Ecological Footprint item. Consequently, subjective perception of influence of
selected environment factors on the standard of living is evaluated, which is based on
a questionnaire survey carried out with participation of 1103 households from the selected
countries. Certain discrepancies were found between the indicators and survey results. The
results concerning the environment influence on the standard of living in Finland are
particularly interesting. The most unsatisfied both with their standard of living and
environment are Czechs and Spaniards. On the contrary, Fins express their satisfaction.
Key Words
Ecological Footprint, Environment, Standard of Living, Happy Planet Index.
Introduction
The standard of living is a notion, the very definition of which is not entirely unambiguous
and which is influenced by a range of factors. It can be evaluated objectively by means of
indicators such as income, consumption, thus individual’s material background. Secondly, it
can be evaluated subjectively by means of education, health condition, way of spending one’s
leisure time, possibility of cultural activities, etc. This defined form of the standard of living is
affected by factors such as satisfaction with the political system, quality of provided services,
household income as well as with the environment, where the household lives.
The standard of living is usually measured with the GDP level calculated on one
inhabitant. According to Turner and Tschirhart (1999), the sense of the GDP per capita is not
the measurement of the standard of living because it does not include the cost of natural
resources. Their understanding as free gifts of nature leads to an assumption that they are
unlimited. This is the reason why only the assets produced by humans are understood as
a productive capital and their depreciation is projected in GDP. If a country decides to cut
down all their forests, the profits earned by the wood sale will be counted as GDP growth for
the particular year. However, future loss of production will be taken into account nowhere,
how Jeníček and Foltýn (2010) define. That is why Victor (2010) differentiates between
economic growth, which is defined as an increase of economic output without other
influences, and economic development, which is related to a wider range of changes, which
are a presumption of future economic output growth.
This is confirmed by Jeníček and Foltýn (2010) who concretely reproach GDP that it
does not concern negative influence of other human activities, which devalue the natural
resources from a quantity as well as quality aspect. Moreover, they add that the natural
resources are not understood as investment results, the expenses of which should be
depreciated. However, as opposed to investments, their value needs to be understood in
potential proceeds. As a result, their depreciation should be captured in accounting purposes
similarly as other kinds of material capital. This fact is confirmed by Bergh (2009), who
reproaches GDP two discrepancies with the accounting principles. GDP does not clearly
differentiates expenses and incomes and does not correctly reflect a change in supplements
and deliveries. Actually, it reveals only expenses and not incomes of all economical activities
in a particular market.
The opportunity of natural resources use, as defined by Victor (2010), is dependent on
a political decision. Disposable quantitative GDP growth, e.g. the felling of forests, is only
illusory. However, its result may have a considerable influence at country economics
evaluation and its consequent long-term political decisions.
Furthermore, Jeníček and Foltýn (2010) further reproach GDP, that it reflects only
financial flows; so housework is not taken into account at all. In developed countries, these
traditional activities are exerted by new services sectors. On the other hand, they are mostly
exerted by housewives in developing countries. As opposed to the services provided, their
activity is not taken into account in national accounts. GDP includes both beneficial and
harmful activities. Negative activities are especially included by environment polluting
productions and these are an evocation of activities removing their consequences. There is no
single contribution because they would not be needed without harmful activities. Not to
mention that it is not always possible to ensure the return to the original condition. But it does
not always have to concern the funds invested directly to environment saving, it also concerns
the expenses to health care, which is even more urgent due to worsened living conditions.
Ananda, D’Ercola and Lowa (2013) also see a problem in a conversion of well-being
per capita. They consider such measurement way of income differentiation by means of Gini
coefficient insufficient as it does not take all components included in well-being into account.
According to Jeníček and Foltýn (2010), there are many things appreciated by people,
which are not a part of GDP because they are not composed with financial flows. Namely,
these are components such as leisure time, health, low criminality level, comfort, nature
beauty and all other activities not passing through the market.
As Večerník (2012) indicates, a significant initiative for observing multidimensional
well-being, which serves as a standard of living quantifier, was “Sarkozy’s report” elaborated
by an economist committee under the leadership of Stiglitz, Sen and Fitoussi. According to
Stiglitz, Sen and Fitoussi (2009), well-being is influenced by several external factors. These
are:

material standard of living (income, consumption and wealth),

health,

education,

personal activity including work,

political environment,

social contacts and relationships,

natural environment,

personal and economical uncertainty.
As this publication is focused mainly on environment, well-being as an external factor
component is closely approximated.
The care of natural resources is important not only for maintaining sustainable
development but it also has a direct influence on human health in the form of water pollution,
air pollution or increased noise. Indirectly, it influences climate changes, loss of biological
diversity and it is a cause for a more frequent occurrence of natural disasters which also
influence the ecosystem. These changes causing floods, hurricanes or earthquakes result in
loss or damage of residences, the consequence of which are obvious worsened living
conditions. In the worst case, they may cause inhabitants’ death. These worsened living
conditions may even make some places on the Earth inhabitable. Stiglitz, Sen,
Fitoussi (2009).
The World Bank (2013) measures all possible forms of pollution, whether it concerns
CO2 emissions in air, all possible components polluting drinking water or forest cover
decrease or availability of electrical energy, which makes globally 77 %.
An insufficiency of all these measurements is a fact that every person perceives the
worsened situation in their environment in another way. Every person is a part of a group
which uses different assessment criteria so that an evaluation of the standard of living of an
entire spectrum of people is not possible by means of these indicators and it is necessary to
question the people in concrete areas. (Stiglitz, Sen, Fitoussi, 2009).
Insufficiencies and disadvantages of the GDP per capita as a standard of living indicator
are realized by many specialists. Subsequently, new alternatives emerge, which either
complete, modify the GDP per capita or which completely replace it with a specific point of
view. One of the most known well-being factors, which take environment into account, is the
Happy Planet Index.
This is a global index measuring sustainable development of well-being. It indicates to
which extent countries provide sustainable conditions for a happy life of their inhabitants. The
Happy Planet Index (HPI) is based on three points:

life expectancy,

personal assessment of inhabitants’ well-being,

ecological footprints.
The basic impulse of this index creation was the inability of GDP to adequately measure
standards of living. For it is focused on production, it marginalizes environment and other life
parameters. The index measures efficiency of how countries produce long and happy life of
their inhabitants per unit of input of environment.
Personal well-being assessment is acquired on the basis of a questionnaire survey when
the respondents were given a scale reaching from zero to ten. Zero represents the worst
possible standard of living and on the contrary, ten the best possible one. Life expectancy is
adapted from the Human Development Index. The Ecological Footprint reflects the natural
resources consumption. It converts how much of the land is needed per capita so that the
current pattern of consumption is sustainable. The unity is a global hectare which is
constituted of a hectare of a land which is able to produce an average amount of the so-called
biocapacity1.
Regarding the index, it is obvious that the set life trend of the Western civilization is not
sustainable and it is essential to search for new ways of development. No country has been
able to integrate these three aspects together yet in order to create happier future. Even HPI
has its insufficiencies and that is why it does not reflect e.g. respect for human rights, which
1
This is the ecosystem capacity to produce usable materials and simultaneously its ability to absorb waste
materials produced by humans at current technologies.
has undoubtedly enormous influence on inhabitants’ life. However, the aim is to direct the
countries to sustainable development, HPI serves then as a mirror, where their success or
failure is reflected. (Happy Planet web).
Objectives and methodology
In the present article, the living conditions in five European Union countries will be
compared. The countries were selected on the basis of the zones of culturally allied countries,
as defined by Svetlík (2003). One representative country from each zone was chosen:
 Finland (for Sweden, Norway, Denmark and Finland),
 France (for Austria, Switzerland and France),
 Spain (for Italy, Spain, Greece and Portugal),
 the United Kingdom (for the United Kingdom and Ireland).
One country from outside these zones was selected (the Czech Republic). The names of these
countries will be abbreviated as follows: Czech Republic (CZ), Finland (FI), France (FR),
Spain (ES) and the United Kingdom (UK).
Firstly, the standard of living in these countries is measured by the common indicator
GDP per capita. In addition to this evaluation, the Happy Planet Index is used. The main
reason for choosing this indicator is the fact, that it includes an item, which evaluates the
environment. The relation for the HPI calculation is as follows:
The main attention is paid to the Ecological Footprint. „The HPI uses the Ecological
Footprint promoted by the environmental charity WWF as a measure of resource
consumption. It is a per capita measure of the amount of land required to sustain a country’s
consumption patterns, measured in terms of global hectares (g ha) which represent a hectare
of land with average productive biocapacity.“ (HPI, 2013).
Furthermore, a questionnaire survey was carried out. The survey was focused on
determination of factors, which influence the standard of living in individual countries.
The main unity of the survey was a household. The questionnaire was always completed
by the person in the head position of a household who took into account the opinion of all
household members. The survey was based on quota selection according to economical
activity. The questionnaire survey was carried out in the period of July 1st until October 1st.
and 1103 household participated in it. The representation in individual countries is shown in
table 1.
I: Number of household participating in the survey according to countries
Country
Number of
households
CZ
FI
FR
ES
UK
351
123
184
332
113
Source: authors’ results based on the survey
8 groups of factors were created and respondents were asked to express themselves to them.
The fact how these factors influence household life was assessed regardless whether it was
a positive or negative influence. In this contribution, attention is paid to factors concerning
environment. Concretely, it concerns the following:

air quality,

water quality,

clean countryside (parks, forests, meadows),

clean public places (e.g. roads, bus stops),

accessibility to greenery and forests,

area of greenery in the place of your residence,

level of noise in the place of your residence,

recycling possibilities (accessibility to the special containers for different types of
waste – e.g. PVC, paper).
The respondents were asked to assess the individual items on a scale reaching from 1 to 10
according to the influence on their life (1 – low influence, 10 – high influence, 0 – I cannot
assess). Moreover, there was an assessment of total satisfaction with the standard of living
and with environment on a scale of very satisfied – satisfied – rather satisfied – rather
unsatisfied – very unsatisfied. Consequently, two groups of satisfaction were created –
satisfaction (very satisfied + satisfied + rather satisfied) and dissatisfaction (rather unsatisfied
+ unsatisfied + very unsatisfied).
Results
The standard of living is usually measured by GDP per capita. The volume index of GDP per
capita in Purchasing Power Standards (PPS) is expressed in relation to the European Union
average. If the index of a country is higher than 100, this country's level of GDP per head is
higher than the EU average and vice versa. Basic figures are expressed in PPS, i.e. a common
currency that eliminates the differences in price levels between countries allowing meaningful
volume comparisons of GDP between countries. The values of GDP per capita for the
selected countries, which have been used for this publication, are shown in table 2.
II: GDP per capita in the selected countries, year 2012
Country
GDP per capita
EU - 28
100
CZ
79
FI
115
FR
108
ES
UK
97
110
Source: Eurostat (2013)
According to the common way of measurement, the highest standard of living is in Finland,
then in the United Kingdom and France. The worst living conditions among these 5 countries
are in the Czech Republic, where the value of GDP per capita was on 79 % of the European
average.
However, the composition of GDP does not cover quality related aspects of a life
situation, and the measure thus represents the success of economy rather than the standard of
living. Hence, many new alternative indicators are arising nowadays.
For instance, one very interesting alternative indicator is the Happy Planet Index. The
index uses global data on life expectancy, experienced well-being and ecological footprint.
Actually, the last item is the most important for purpose of this text.
III: Happy Planet Index in the selected countries
Country
HPI
Experienced
well-being
CZ
FI
FR
ES
UK
39,4
42,7
46,5
44,1
47,9
6,2
7,4
6,8
6,2
7
Life
Ecological
expectancy Footprint
77,7
80,0
81,5
81,4
80,2
5,3
6,2
4,9
4,7
4,7
Source: HPI web (2013)
Obviously, the results show the differences in ranking in comparison with GDP per capita.
The United Kingdom is the country, where the living conditions are the best. In fact, UK
ranks number 41 of all the countries in the world. Next, France achieves the high HPI score
and ranks the 50th place. According to GDP per capita, Finland was the first country with high
standard of living among selected. On the contrary, HPI indicates Finland as the 70th best state
for living in the world. Clearly, Spain is better than Finland, because it ranks number 62 of all
the countries around the globe. Finally, the Czech Republic with the HPI score of 39.4 is
ranked as 92nd.
When focusing on the Ecological Footprint only, there are changes in ranking. Firstly,
the best results are in the United Kingdom and Spain. Next in France and then in the Czech
Republic. Last, the worst results connected with Ecological Footprint is achieved by Finland.
In fact, Finland’s HPI score is brought down by a very high Ecological Footprint, which is
very surprising finding, because Finish people are usually considered as eco-friendly.
For assessment of standards of living it is also very important to pay attention to
subjective opinions of inhabitants. On the basis of the realized questionnaire survey, the aim
was to find out how inhabitants of the selected countries perceive their satisfaction with
standard of living (figure 1).
Source: authors’ results based on the survey
1: Satisfaction with standard of living
Fins are the most satisfied inhabitants. To 77% of them expressed themselves that they were
very satisfied or rather satisfied. The highest dissatisfaction is in the Czech Republic. 68 % of
the respondents are rather unsatisfied with their standards of living (45 %) to very unsatisfied.
The most very unsatisfied people live in France (13 %), following by the United Kingdom
(10 %).
Concerning the environment, eight items were created and respondents were asked to
express themselves to them. They evaluated how these areas are important for their
households. That means it was not important how they evaluated the items condition in their
country. The arithmetic average of evaluation for individual countries is approached by
figure 2.
Source: authors’ results based on the survey
2: Evaluation of value of various environmental items
It is obvious that all the items are the most essential for the inhabitants of Finland. Especially
clean countryside and accessibility to greenery and forests is very important to Fins. Air
quality and water quality is important for Czechs. Clean countryside, clean public places,
level of noise and recycling possibilities are important for French. British have the lowest
requirements of environment in areas of air quality, accessibility to greenery and forests.
Concerning water quality, clean countryside, clean public places and level of noise, it is the
least essential for Spanish inhabitants.
Subsequently, the respondents were asked to answer the question how they were
satisfied with the above mentioned items, i.e. how they evaluate the level of these items in
general in their locality. The results revealed interesting facts, which are approximated in the
following figure 3.
Source: authors’ results based on the survey
3: Satisfaction with environment
IV: Expression of satisfaction with environment
Country
Satisfaction (%) Dissatisfaction (%)
CZ
FI
FR
ES
UK
32
75
39
22
46
68
25
61
78
54
Source: authors’ results based on the survey
It was shown that 33 % of Fins are very satisfied, 27 % satisfied and 15 % rather satisfied. On
the second place, 46 % of British expressed their satisfaction. The most unsatisfied inhabitants
are Spaniards, followed by Czechs.
Conclusion
The effort was to find out which environment factors influence the standard of living in the
Czech Republic, Finland, France, Spain and in the United Kingdom. Firstly, the standard of
living was assessed according to secondary data. GDP per capita shows that the highest
standard of living among the selected countries is in Finland, then in the United Kingdom,
afterwards in Spain and the lowest standard of living is in the Czech Republic.
Many professional publications point to the fact that GDP per capita is not the best way
to measure the standard of living. Inter alia, it does not take the environment condition into
account. From this reason, the standard of living was consequently assessed on the basis of
the alternative Happy Planet Index. Its results imply a completely different rank of countries.
The best set conditions are in the United Kingdom. It is a country with the 41st best rank in
standard of living evaluation in the world. The next country is France followed by Spain and
the fourth is surprisingly Finland. The last place among the particular countries stays
unchanged, it is the Czech Republic.
When looking at the Ecological Footprint, it is obvious that the change of Finland
position was caused by this item value. The reason is that experienced well-being is at the best
level. This fact is highly surprising because Fins are generally considered to be an ecofriendly nation. On the basis of the questionnaire survey, this fact was confirmed because Fins
care the most about the condition of all eight factors which are connected to the standard of
living and they are also the most satisfied with environment. The second country, where
inhabitants expressed their highest satisfaction was the United Kingdom, then France, the
Czech Republic and Spain.
Clean countryside and accessibility to greenery and forests are the most important items
for Fins. Clean countryside, clean public places, level of noise and recycling possibilities are
mostly appreciated by French. Air quality and water quality are essential for Czechs.
Spaniards have the lowest requirements of environment in areas of water quality, clean
countryside, clean public places and level of noise. The items of air quality, accessibility to
greenery and forests are the least important for the inhabitants of the United Kingdom.
When comparing the individual ranks shown in this publication, different discrepancies
are observed. Especially in case of Finland. It is possible to admit that the findings from the
questionnaire survey, which is related to satisfaction with environment, are the most similar to
the ranks of the standards of living measured by GDP per capita with an exception of the last
and penultimate place. However, it is not possible to conclude that GDP per capita is
a suitable indicator and HPI unsuitable. It would be essential to take other factors into
account, than just environment and it would be also necessary to have more respondents for
finding out subjective opinions. At this point, it is only possible to remark the fact that for
individual indicators’ accuracy assessment it is essential to analyze more in-depth, to take
a wide spectrum of areas into account and to perform in-depth analyses.
Acknowledgement
The paper is elaborated in connection with solution of the project: "Faktory ovlivňující životní
úroveň v EÚ", which is funded by the IGA PEF MENDELU Brno (no. 42/2013).
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Standard of Living Factors with Respect to Environment in Selected