Helje Kaldaru

The Effect of Macro-level Social Capital on Sustainable Economic Development

The concept of social capital as an important determinant of economic development is attracting increasing attention among development economists. The present paper analyses the impact of macro-level social capital on economic development in 34 European countries. Macro-level social capital comprises different aspects of institutional quality and is closely related to the income distribution and social cohesion. We used principal component analysis to group initially selected social determinants of economic development into three components (human and social capital, income equality, and redistribution), which altogether described 64.4% of the variation of the initial variables. Following regression analysis proved that all these components have a positive effect on economic development, measured by human development index.

Social and institutional factors of economic development: evidence from Europe

Abstract Social and institutional determinants of economic development are attracting increasing attention among development economists. The present paper analyses the impact of macro-level social capital and related social factors on economic development in 34 European countries. Macro-level social capital comprises different aspects of institutional quality and is closely related to income distribution and social cohesion. We used principal component analysis to group initially selected social determinants of economic development into three components (human and social capital, income equality, and redistribution), which altogether describe 64.4% of the variation in initial variables. The following regression analysis proved that all these components have a positive effect on economic development, measured by the human development index.

The Role of Human and Social Capital for Innovation in Catching-Up Economies

This exploratory study investigates how innovative activities are related to human and social capital in the context of catching-up countries facing both latecomer advantages and path dependency. Data on 30 European countries are analyzed, including ten transition countries with communist backgrounds that are considered catching-up countries in this study. The results showed that catching-up economies, which tend to have poorer performance in innovative activities, also tend to have lower levels of human capital and social capital. Increasing institutional trust and encouraging lifelong learning can be considered most important. It also appeared that while smaller catching-up countries benefit from the higher levels of social capital usually observed in smaller countries, the opportunities associated with being large did not seem to be sufficiently exploited in the larger catching-up countries.

In Memoriam prof. Heiki Müür (1932-1996). Mit Zusammenfassung

Professor Heiki Muur had his successful professional career mainly during the soviet period. Heiki Muur was born in 1932 in Tallinn. In 1954, at the age of 22, he received the diploma from the Tallinn Technical University, honouring him as a good specialist in socialist economy. This educational background allowed him to continue the post-graduate studies in the Moscow Institute of Economics. In 1959, he defended PhD thesis (candidate in economics), and in 1976, was approved as the habilitated doctor in Economics. Heiki Muur started his academic career at the Tartu State University in 1956, working initially as a lector and later as a docent and a professor. He published several books in Estonian that were actively used by the students as well as practitioners: Management and Planning, 1964; Prices and Economic Reform, 1971; Economic Planning, 1971; Economics and National Economy (editor of the series of books, 1972-1974; National Balance and Planning (1987, co-author). During his academic career, professor Heiki Muur demonstrated good abilities for leadership working as a vice dean and the dean at Tartu State University, and after 1990s, as a head of the institute of the Faculty of Economics and Business Administration at the University of Tartu. During the years 1981-1986, he was the director of the Research Institute, which worked for the Soviet Estonian government in Tallinn; during these years, he also continued to work as a part-time professor at the university. We, as his students of the field of “economic cybernetics” (mathematical economics) and successors, appreciate particularly highly his activities and success in establishing and promoting education in mathematical economics at the Faculty of Economics of the Tartu State University. The new specialisation in the soviet economic education with the name “economic cybernetics” was opened at the Tartu State University in 1967. Professor Heiki Muur devoted lots of his energy, time and knowledge to create the school of young economists who have good knowledge in applying mathematical and statistical methods for analysing economic problems in Estonia. The knowledge in economics and research methodology of these graduates was not heavily related to the soviet rules of the economic mechanism. In collaboration with the young postgraduates, professor Muur started to develop applied research for the soviet firms examining the relationship between the working conditions and economic outcomes and implementing modern mathematical and statistical methods by conducting economic analysis. He was one of the initiators and organisers of the high scientific level economic conference on applying modern methods for analysing economic processes in Tallinn in 1981. L. Kantorovits, the only soviet economist who got Nobel Prize (1975) in relation to elaborating and developing linear programming methods, was among the participants of the conference. Professor Heiki Muur was innovative and flexible in starting to restructure the curricula and study process at the University of Tartu after Estonia regains its independence. He was the initiator of offering new study courses in market economy not only for the students of the Faculty of Economics, but also for students from other faculties as well as for practitioners. The graduates, who obtained diploma in “economic cybernetics” and belonged to the school of the Estonian economists established by the significant contribution of professor Heiki Muur continued his work being the initiators and developers of the new economic curricula and of restructuring economic education and research in compliance with high level international requirements

WELFARE CHANGES IN EASTERN EUROPEAN AND CENTRAL ASIAN TRANSITION ECONOMIES

This paper investigates the regularities of the transition processes in countries at different levels of transformation from 1994–1998. Twenty-four countries are involved into the analysis and the indicator of welfare is used for analysis. Welfare is measured by the production of gross product per capita, which is adjusted with purchasing power parity (GDP-PPP). The 24 countries will be divided into three groups according to the level of transformation, using the canonical discriminant analysis. The basis of the analysis will be the transition index computed by EBRD. For each group, a component analysis related to various economic indicators will be used. From the results, four transition components will be formed. The effect of the obtained transition components on welfare will be examined with the help of regression analysis, the results of which are the basis for interpreting the causes of welfare changes. The paper concludes that the main factor determining welfare is the development level of a country. Other factors have less influence.