Location: Eastern Europe
Vaccination Progress and the Opening Up of Economies
In this brief, we report on the FREE network webinar on the state of vaccinations and the challenges ahead for opening up economies while containing the pandemic, held on June 22, 2021. The current state of the pandemic in each respective country was presented, suggesting that infection rates have gone down quite substantially recently in all countries of the network, except in Russia which is currently facing a surge in infections driven by the delta-version of the virus. Vaccination progress is very uneven, limited by lacking access to vaccines (primarily Ukraine and Georgia) and vaccine scepticism among the population (primarily in Russia and Belarus but for certain groups also in Latvia, Poland and to some extent Sweden). This also creates challenges for governments eager to open their societies to benefit their economies and ease the social consequences of the restrictions on mobility and social gatherings. Finally, the medium to long term consequences for labour markets reveal challenges but also potential opportunities through wider availability of work–from-home policies.
Background
In many countries in Europe, citizens and governments are starting to see an end to the most intense impact of the Covid-19 pandemic on their societies. Infection and death rates are coming down and governments are starting to put in place policies for a gradual opening up of societies, as reflected in the Covid-19 stringency index developed by Oxford University. These developments are partially seasonal, but also largely a function of the progress of vaccination programs reaching an increasing share of the adult population. These developments, though, are taking place to different degrees and at different pace across countries. This is very evident at a global level, but also within Europe and among the countries represented in the FREE network. This has implications for the development within Europe as a whole, but also for the persistent inequalities we see across countries.
Short overview of the current situation
The current epidemiological situation in Latvia, Sweden, Ukraine, and Georgia looks pretty similar in terms of Covid-19 cases and deaths but when it comes to the vaccination status there is substantial variation.
Latvia experienced a somewhat weaker third wave in the spring of 2021 after being hit badly in the second wave during the fall and winter of 2020 (see Figure 1). The Latvian government started vaccinating at the beginning of 2021, and by early June, 26% of the Latvian population had been fully vaccinated.
Sweden, that chose a somewhat controversial strategy to the pandemic built on individual responsibility, had reached almost 15 thousand Covid-19 deaths by the end of June of 2021, the second highest among the FREE network member countries relative to population size. The spread of the pandemic has slowed down substantially, though, during the early summer, and the percentage of fully vaccinated is about to reach 30% of the population.
Figure 1. Cumulative Covid-19 deaths
Source: Aggregated data sources from the COVID-19 Data Repository by the Center for Systems Science and Engineering (CSSE) at Johns Hopkins University, compiled by Our World in Data.
Following a severe second wave, the number of infected in Ukraine started to go down in the winter of 2020, with the total deaths settling at about 27 thousand in the month of February. Then the third wave hit in the spring, but the number of new daily cases has decreased again and is currently three times lower than at the beginning of the lastwave. However, a large part of the reduction is likely not thanks to successful epidemiological policies but rather due to low detection rates and seasonal variation.
In June 2021, Georgia faces a similar situation as Ukraine and Latvia, with the number of cumulative Covid-19 deaths per million inhabitants reaching around 1300 (in total 2500 people) following a rather detrimental spring 2021 wave. At the moment, both Georgia and Ukraine have very low vaccination coverage relative to other countries in the region(see Figure 5).
In contrast to the above countries, Russia started vaccinating early. Unfortunately, the country is now experiencing an increase in the number of cases (as can be seen in Figure 2), contrary to most other countries in the region. This negative development is likely due to the fact that the new Covid-19 delta variant is spreading in the country, particularly in Moscow and St. Petersburg. Despite the early start to vaccinations, though, the total number of vaccinated people remains low, only reaching 10.5% of the population.
Figure 2. New Covid-19 cases
Source: Aggregated data sources from the COVID-19 Data Repository by the Center for Systems Science and Engineering (CSSE) at Johns Hopkins University, compiled by Our World in Data.
In some ways similar to Sweden, the government of Belarus did not impose any formal restrictions on individuals’ mobility. According to the official statistics, in the month of June, the rise in the cumulative number of covid-19 deaths and new daily infections has declined rapidly and reached about 400 deceased and 800 infections per one million inhabitants, respectively. Vaccination goes slowly, and by now, around 8% of the population has gotten the first dose and 5% have received the second.
There were two major waves in Poland during the autumn 2020 and spring 2021. In the latter period, the country experienced a vast number of deaths. As can be seen in Figure 3, the excess mortality P-score – the percentage difference between the weekly number of deaths in 2020-2021 and the average number of deaths over the years 2015-2019 – peaked in November 2020, reaching approximately 115%. The excess deaths numbers in Poland were also the highest among the FREE Network countries in the Spring of 2021, culminating at about 70% higher compared to the baseline. By mid-June, the number of deaths and cases have steeply declined and 36% of the country’s population is fully vaccinated.
Figure 3. Excess deaths
Source: Human Mortality Database & World Mortality Dataset compiled by Our World in Data.
Turning to the economy, after a devastating year, almost all countries are expected to bounce back by the end of 2021 according to the IMF (see Figure 4). Much of these predictions build on the expectations that governments across the region will lift Covid-19 restrictions. These forecasts may not be unrealistic for the countries where vaccinations have come relatively far and restrictions have started to ease. However, for countries where vaccination rates remain low and new variations of the virus is spreading, the downside risk is still very present, and forecasts contain much uncertainty.
Figure 4. GDP-growth
Vaccination challenges
Since immunization plays such a central role in re-opening the economy and society going back to normal, issues related to vaccinations were an important and recurring topic at the event. The variation in progress and speed is substantial across the countries, though.
Ukraine and Georgia are still facing big challenges with vaccine availability and have fully vaccinated only 1.3% and 2.3% of the population by the end of June, respectively. Vaccination rates have in the recent month started to pick up, but both countries face an uphill battle before reaching levels close to the more successful countries.
Figure 5. Percent fully vaccinated
Source: Official data compiled by Our World in Data. See full source list at: https://github.com/owid/covid-19-data/blob/master/public/data/vaccinations/locations.csv
Other countries a bit further ahead in the vaccine race are still facing difficulties in increasing the vaccination coverage, though not so much due to lack of availability but instead because of vaccine skepticism. In Belarus, a country that initially had bottleneck issues similar to Ukraine and Georgia, all citizens have the opportunity to get vaccinated. However, Lev Lvovskiy, Senior Research Fellow at BEROC in Belarus, argued that vaccination rates are still low largely because many Belarusians feel reluctant towards the vaccine at offer (Sputnik V).
This vaccination scepticism turns out to be a common theme in many countries. According to different survey results presented by the participants at the webinar, the percentage of people willing or planning to get vaccinated is 30% in Belarus and 44% in Russia. In Latvia, this number also varies significantly across different groups as vaccination rates are significantly lower among older age cohorts and in regions with a higher share of Russian-speaking residents, according to Sergejs Gubins, Research Fellow at BICEPS in Latvia.
Webinar participants discussed potential solutions to these issues. First, there seemed to be consensus that offering people the opportunity to choose which vaccine they get will likely be effective in increasing the uptake rate. Second, governments need to improve their communication regarding the benefits of vaccinations to the public. Several countries in the region, such as Poland and Belarus, have had statements made by officials that deviate from one another, potentially harming the government’s credibility with regards to vaccine recommendations. In Belarus, there have even been government sponsored disinformation campaigns against particular vaccines. In Latvia, the main problem is rather the need to reach and convince groups who are generally more reluctant to get vaccinated. Iurii Ganychenko, Senior Researcher at KSE in Ukraine, exemplified how Ukraine has attempted to overcome this problem by launching campaigns specifically designed to persuade certain age cohorts to get vaccinated. Natalya Volchkova, Director of CEFIR at NES in Russia, argued that new, more modern channels of information, such as professional influencers, need to be explored and that the current model of information delivery is not working.
Giorgi Papava, Lead Economist at ISET PI in Georgia, suggested that researchers can contribute to solving vaccine uptake issues by studying incentive mechanisms such as monetary rewards for those taking the vaccine, for instance in the form of lottery tickets.
Labour markets looking forward
Participants at the webinar also discussed how the pandemic has affected labour markets and whether its consequences will bring about any long-term changes.
Regarding unemployment statistics, Michal Myck, the Director of CenEA in Poland, made the important point that some of the relatively low unemployment numbers that we have seen in the region during this pandemic are misleading. This is because the traditional definition of being unemployed implies that an individual is actively searching for work, and lockdowns and other mobility restrictions have limited this possibility. Official data on unemployment thus underestimates the drop in employment that has happened, as those losing their jobs in many cases have left the labour market altogether. We thus need to see how labor markets will develop in the next couple of months as economies open up to give a more precise verdict.
Jesper Roine, Professor at SITE in Sweden, stressed that unemployment will be the biggest challenge for Sweden since its economy depends on high labor force participation and high employment rates. He explained that the pandemic and economic crisis has disproportionately affected the labor market status of certain groups. Foreign-born and young people, two groups with relatively high unemployment rates already prior to the pandemic, have become unemployed to an even greater extent. Many are worried that these groups will face issues with re-entering the labour market as in particular long-term unemployment has increased. At the same time, there have been more positive discussions about structural changes to the labour market following the pandemic. Particularly how more employers will allow for distance work, a step already confirmed by several large Swedish firms for instance.
In Russia, a country with a labour market that allowed for very little distance work before the pandemic, similar discussions are now taking place. Natalya Volchkova reported that, in Russia, the number of vacancies which assumed distance-work increased by 10% each month starting from last year, according to one of Russia’s leading job-search platforms HeadHunter. These developments could be particularly beneficial for the regional development in Russia, as firms in more remote regions can hire workers living in other parts of the country.
Concluding Remarks
It has been over a year since the Covid-19 virus was declared a pandemic by the World Health Organization. This webinar highlighted that, though vaccination campaigns in principle have been rolled out across the region, their reach varies greatly, and countries are facing different challenges of re-opening and recovering from the pandemic recession. Ukraine and Georgia have gotten a very slow start to their vaccination effort due to a combination of lack of access to vaccines and vaccine skepticism. Countries like Belarus and Latvia have had better access to vaccines but are suffering from widespread vaccine skepticism, in particular in some segments of the population and to certain vaccines. Russia, which is also dealing with a broad reluctance towards vaccines, is on top of that dealing with a surge in infections caused by the delta-version of the virus.
IMF Economic Outlook suggests that most economies in the region are expected to bounce back in their GDP growth in 2021. While this positive prognosis is encouraging, the webinar reminded us that there is a great deal of uncertainty remaining not only from an epidemiological perspective but also in terms of the medium to long-term economic consequences of the pandemic.
Participants
- Iurii Ganychenko, Senior Researcher at Kyiv School of Economics (KSE/Ukraine)
- Sergejs Gubins, Research Fellow at the Baltic International Centre for Economic Policy Studies (BICEPS/ Latvia)
- Natalya Volchkova, Director of the Centre for Economic and Financial Research at New Economic School (CEFIR at NES/ Russia)
- Giorgi Papava, Lead Economist at the ISET Policy Institute (ISET PI/ Georgia)
- Lev Lvovskiy, Senior Research Fellow at the Belarusian Economic Research and Outreach Center (BEROC/ Belarus)
- Jesper Roine, Professor at the Stockholm Institute of Transition Economics (SITE / Sweden)
- Michal Myck, Director of the Centre for Economic Analysis (CenEA / Poland)
- Anders Olofsgård, Deputy Director of SITE and Associate Professor at the Stockholm School of Economics (SITE / Sweden)
Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.
Strategies to Opening up After the Pandemic
The Stockholm Institute of Transition Economics (SITE) in collaboration with the FREE Network is delighted to invite you to a webinar to share insights and knowledge on different strategies implemented in vaccination, opening up the borders and the socioeconomic aspects within Sweden, Eastern Europe and the Baltic Sea region, and the Caucasus region.
Since vaccination has started across all over the world, it is vital to reflect upon the road map different countries have chosen to open up societies and economies. How will countries in Eastern Europe and the Baltic Sea region, and the Caucasus region handle the opening of their respective borders and what lies next in line to go back to a pre-pandemic societal routine?
Register
- RSVP: Monday, June 21, 2021, 23:59 (CET, Sweden).
- Location: Online. A link to the webinar will be sent to you 4-5 hours ahead of the start of the webinar.
- Registration: Please register via the Eventbrite platform (see here).
Agenda
The webinar is part of a series of online discussions aiming to provide regional overview updates as well as in-depth analysis of specific topics related to the COVID-19 pandemic. Since the FREE Network includes research and policy institutes in Belarus (BEROC), Latvia (BICEPS), Russia (CEFIR at NES), Poland (CenEA), Georgia (ISET PI), Ukraine (KSE) and Sweden (SITE) the upcoming webinar will provide a comprehensive regional perspective on different strategies implemented in vaccination, opening up the borders and the socio-economic aspect. Learn more about the different strategies in FREE Network countries and ask questions directly to distinguished panelists and experts.
Speakers
- Jesper Roine, Professor at the Stockholm Institute of Transition Economics (SITE/ Sweden)
- Iurii Ganychenko, Senior researcher at Kyiv School of Economics (KSE/Ukraine)
- Lev Lvovskiy, Senior Research Fellow at the Belarusian Economic Research and Outreach Center (BEROC/ Belarus)
- Michal Myck, Director of the Centre for Economic Analysis (CenEA/ Poland)
- Natalya Volchkova, Director of the Centre for Economic and Financial Research at New Economic School (CEFIR at NES/ Russia)
- Sergejs Gubins, Research Fellow at the Baltic International Centre for Economic Policy Studies (BICEPS/ Latvia)
- Giorgi Papava, Lead Economist at ISET Policy Institute (ISET PI/ Georgia)
Chair/Moderator
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- Anders Olofsgård, Deputy Director of the Stockholm Institute of Transition Economics (SITE) and Associate Professor at the Stockholm School of Economics (SSE)
Green Concerns and Salience of Environmental Issues in Eastern Europe
Changes in individual behavior are an essential component of the planet’s effort to reduce carbon emissions. But such changes would not be possible without individuals acknowledging the threat of anthropogenic climate change. This brief discusses the climate change risk perceptions across Europe. We show that people in Eastern Europe are, on average, less concerned about climate change than those in Western Europe. Using detailed survey data, we find evidence that the personal experience of extreme weather events is a key driver of green concern, and even more so in the non-EU Eastern part of Europe. We argue that this association might be explained by the relatively low quality and informativeness of public messages concerning global warming in this part of Europe. If information is scarce or perceived as biased, personal experience will resonate more.
Introduction
Climate change is one of the main threats to humanity. Tackling it entails a combined effort from all parts of society, from regulatory changes and industries adopting new greener business models to consumers adjusting their behavior. While an individual’s contribution to climate change may appear insignificant, research shows that the aggregate effect of mobilizing already known changes in consumer behavior may allow the European Union (EU) to reduce its carbon footprint by about 25% (Moran et al., 2020).
However, the first step for people to adjust their consumption patterns is to acknowledge the threat of anthropogenic climate change. Public ignorance about climate change’s impacts remains high across the world. Furthermore, citizens of more polluting countries are often relatively less concerned about climate change. This lack of awareness is not well-understood, in part due to the multi-dimensional local factors affecting it (Farrell et al., 2019).
This brief discusses the potential drivers of climate risk perceptions, focusing on the differences between Western Europe, Eastern European states that are part of the EU, and non-EU Eastern European countries. We first present the climate change concerns across these regions. We then discuss to which extent the country’s pollution exposure measures and individuals’ socio-economic characteristics can explain these differences. We show that the personal experience of extreme weather events is a key driver of green concern, and even more so in the non-EU part of Eastern Europe. We relate this result to the relatively low salience and informativeness of public messages concerning climate in this part of Europe and discuss potential policy implications.
Green Concerns and Pollution Exposure Across Europe
Figure 1 compares, across Europe, the share of poll respondents who see climate change as a major threat, based on the data from the Lloyd’s Register Foundation World Risk Poll 2020. While there is a significant variation in climate risk perception within each region, respondents in Eastern Europe are, on average, less concerned about climate change than those in Western Europe. We observe a similar pattern between the EU and non-EU parts of Eastern Europe.
Exposure to pollution does not seem to clearly explain these differences. Moreover, the patterns of correlation between climate concern and pollution differ across regions and measures of pollution exposure. The left panel of Figure 2 presents averages across the regions for two pollution measures: carbon emissions (which is, perhaps, reflecting climate threat in general) and air quality (which is more directly associated with health risks). We can see that CO2 emissions are the highest in the non-EU part of Eastern Europe, the least environmentally concerned region. Still, the EU part of Eastern Europe has the lowest average emissions per capita across the three regions (this ranking likely results from the interaction between reliance on fossil fuels, industrial structure, and level of development across the three regions). At the same time, when it comes to the average air quality (measured as the percentage of population exposed to at least 10 micrograms of PM2.5/m3), the non-EU EasternEuropean region is doing better than its EU counterpart, which is more climate concerned. Here, better average air quality in the non-EU Eastern European region is due to its relatively low population density, and consequently, low PM2.5 exposure in large parts of Russia. (See, more on the air quality gap within the EU in Lehne, 2021).
Figure 1: Climate concerns in Eastern and Western Europe
Source: Authors’ calculations based on Lloyd’s Register Foundation World Risk Poll 2020, question 5 “Do you think that climate change is a very serious threat, a somewhat serious threat, or not a threat at all to the people in this country in the next 20 years?”. Averages are calculated with population-representative weights.
The right panel of Figure 2 shows correlations between (country-level) climate concerns and pollution. For CO2, the correlation is negative in all three regions, suggesting that, within each region, more emitting countries are less concerned. This negative correlation, however, is the strongest in the EU-part of Eastern Europe and almost absent in the non-EU part. The differences between the regions are even more striking for the correlation between climate concerns and air quality: both in Western Europe and in the EU part of Eastern Europe, citizens of countries with worse air quality are more concerned about climate change. However, in non-EU Eastern Europe, the relation is the exact opposite: lower concerns about climate change go hand-in-hand with worse quality of air.
Figure 2: Emissions vs. Climate concerns in Eastern and Western Europe, 2018
Source: Authors’ calculations based on www.climatewatchdata.org, OECD and World Risk Poll 2020. The climate concern variable is a country-level weighted average of answers “Very high risk” to the World Risk Poll 2020 question 5, see note to Figure 1.
Green Concerns and Socio-economic Characteristics
Lower climate concerns in EU-part of the Eastern bloc have been documented before; they are often explained by the Eastern-European economies’ high reliance on coal and other fossil fuels, low-income levels, and other immediate problems that lower the priority of climate issues (e.g., Lorenzoni and Pidgeon 2006, Poortinga et al., 2018, or Marquart-Pyatt et al., 2019). Additionally, the literature suggests that climate beliefs are linked to individuals’ socio-economic characteristics, such as level of education, income, or gender (see, e.g., Poortinga, 2019), which may be different across the regions.
However, the regional differences in climate beliefs also persist when we use individual-level data and control for respondents’ individual characteristics, as well as for country-level variables, such as GDP per capita, oil, gas, and coal dependence of the economies, and exposure to emissions (at the country level, as our individual data does not have this information). This is illustrated in Column 1 of Table 1.
Table 1: Climate change beliefs determinants, individual-level cross-section data.
Source: This is an outcome of logistic regression. Experience =1 if the respondent answered “yes” to the World Risk Poll 2020 question L8D “Have you or someone you personally know, experienced serious harm from severe weather events, such as floods or violent storms in the past TWO years?” Media Freedom is based on 2018 Freedom House data, and scores media between 0 (worst) and 4 (best). Controls include age, gender, education, personal feelings about household income, income quantile, urban/rural, size of household, number of children under 15, las well as log of GDP per capita, log of CO2 per capita, mean exposure to PM2.5, and oil, gas and coal rents as a share of GDP. Robust standard errors in parentheses. *** p<0.01, ** p<0.05, * p<0.1
In what follows, we explore another key driver, the personal experience of extreme weather events. While there is a sizable literature on the effect of experience on climate beliefs, that factor was never, to our knowledge, considered to understand the difference in climate risk perception between the EU- and non-EU parts of Eastern Europe.
Green Concern and Salience of Environmental Issues
In line with the recent climate risk perceptions literature (e.g., Van der Linden, 2015), we show that personal experience increases the likelihood of considering climate change as a major threat across all three regions (see column 2 in Table 1). The association is stronger in the EU part of Eastern Europe and even more so in the non-EU part (even if the difference between the last two is not statistically significant). This finding is confirmed when we control for (observable and unobservable) country-specific effects, such as social norms, via the inclusion of country-level fixed effects. In this case, extreme weather events make respondents more climate-conscious within each country (Column 3 of Table 1). In this specification, the effect differs statistically between the two groups of Eastern-European countries, even if only at a 10% significance level. To put it differently, the impact of personal experience with extreme weather events seems to close a sizable part of the gap in climate risk perceptions across the regions and more so in the non-EU part of Eastern Europe.
Our preferred explanation for this finding is that personal experience resonates with the quality and informativeness of public messages concerning global warming. If information is scarce or perceived as biased, personal experience will resonate more. The low political salience of environmental issues in Eastern Europe, inherited from its Soviet past (McCright, 2015), and lower media quality in Eastern Europe (see e.g., Zuang, 2021) are likely to affect the quality of public discourse concerning the risks of climate change, and, consequently, the information available to individuals.
The climate-related legislative effort across Eastern Europe reflects the low political importance of climate change in the region. According to the data from Grantham Research Institute on Climate Change and the Environment, non-EU transition countries, on average, have adopted 8 climate-related laws and policies, while the corresponding figure is 11.5 for EU transition countries and 18 for the countries in Western Europe. Further, Figure 3 shows a positive correlation between climate change concerns and the number of climate-related laws for Western Europe and the EU-part of Eastern Europe but a negative one for the non-EU part of Eastern Europe and Caucasus countries. One possible interpretation of these differences is that climate change is relatively low on the political agenda of (populist) regimes in the non-EU part of Eastern Europe, as climate-related legislative activity (proxied by, admittedly rough, a measure of the number of laws) does not reflect the intensity of population climate preferences.
Figure 3: Climate concern vs. Climate legislation
Source: Authors’ calculations based on climate legislation data from Grantham Research Institute on Climate Change and the Environment, and World Risk Poll 2020
Regarding the influence of media quality, column (4) of Table 1 shows that the effect of personal experience on climate change concern is negatively correlated with media freedom. One interpretation could be that individuals in countries with freer media infer less from their extreme weather experience because more accurate media coverage about climate risks improves the population’s knowledge on the issue.
Of course, the causality of the climate belief-experience relationship could also go in the other direction – people who are more concerned about climate change could be more likely to interpret their personal experience as weather-related extreme events. It is impossible to distinguish with the data at hand. However, Myers et al. (2013) show that both channels are present in the US, and the former channel dominates for the people less engaged in the climate issue. Stretching this finding to the Eastern Europe case, we argue that more precise information on the importance of climate change may partially have the same effect as experience – i.e., it will increase people’s awareness and concern about the consequences of global warming.
Conclusion
This brief addresses the differences in climate change beliefs between Eastern and Western Europe, as well as within Eastern Europe. It discusses the determinants of these differences and stresses the importance of personal experience, especially in the non-EU part of Eastern Europe. It relates this finding to the relatively low accuracy of information and quality of public discourse about climate change in the region.
We know already that tackling climate change requires reliable and accurate sources of information. This is especially crucial given what we outline in this brief. This issue resonates with the current social science analysis of the diffusion of climate change denial (see e.g., Farell et al., 2019, on the significant organized effort in spreading misinformation about climate change). Such contrarian information that relays uncertainty and doubt regarding the severity of the global climate change threat could have a severe impact, especially in situations with low political salience of climate change, like in non-EU Eastern Europe. A significant effort of both governments and civil society is needed to provide adequate information and mobilize the population in our common fight against climate change.
References
- Farrell, J., McConnell, K., and Brulle, R. (2019). Evidence-based strategies to combat scientific misinformation. Nature Climate Change, 9(3), 191-195.
- Lehne, J. (2021), Pollution and the COVID-19 Pandemic: Air Quality in Eastern Europe, FREE Policy brief.
- Lorenzoni, I., Pidgeon, N.F., (2006). Public Views on Climate Change: European and USA Perspectives. Climatic Change 77.
- (2019) Climate Change Views, Energy Policy Preferences, and Intended Actions Across Welfare State Regimes: Evidence from the European Social Survey, International Journal of Sociology, 49:1, 1-26,
- McCright, A., Dunlap, R and Marquart-Pyatt, S. (2015). Political ideology and views about climate change in the European Union. Environmental Politics. 25. 1-21..
- (2020) Quantifying the potential for consumer-oriented policy to reduce European and foreign carbon emissions, Climate Policy, 20:sup1, S28-S38
- Myers, T., Maibach, E., Roser-Renouf, C., Akerlof, K. and Leiserowitz, A. (2013). The Relationship Between Personal Experience and Belief in the Reality of Global Warming. Nature Climate Change. 3. 343-347.
- Poortinga, W., S. Fisher, G. Böhm, L. Steg, L. Whitmarsh and C. Ogunbode, (2018) European Attitudes to Climate Change and Energy: Topline Results from Round 8 of the European Social Survey.
- Poortinga, W., L. Whitmarsh, L. Steg, G. Böhm, S. Fisher, (2019) Climate change perceptions and their individual-level determinants: A cross-European analysis, Global Environmental Change, Volume 55, 2019, Pages 25-35,
- Van der Linden, S. (2015). The social-psychological determinants of climate change risk perceptions: Towards a comprehensive model. Journal of Environmental Psychology, 41, 112-124.
- Zhuang M. (2021), Media Freedom in Eastern Europe, FREE Policy brief https://freepolicybriefs.org/2021/02/22/media-freedom-eastern-europe/
Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.
Jurisdictional Competition for FDI in Developing and Developed Countries
This brief is based on research studying jurisdictional competition between countries and its influence on the inflow of foreign direct investments (FDI). The study compares jurisdictional competition among the developing Central and Eastern European (CEE) countries with competition among developed EU countries. As instruments of jurisdictional competition for FDI, we consider governments’ efforts to improve the rule of law, corporate governance, and tax policies. The results suggest the presence of proactive jurisdictional competition via the quality of corporate governance regulation both in the CEE and the EU countries. The CEE states also attract FDI by competing in tax policies.
Introduction
The determinants of FDI inflows have been examined in numerous studies. A substantial number of them consider the influence of institutions, which are defined as particular organizational entities, procedural devices, and regulatory frameworks (IMF, 2003).
The quality of institutions is a particularly important FDI determinant for less-developed countries because the poor institutional quality and weak law enforcement increase the costs of running a business, create barriers for financial market efficiency, and increase the probability of foreign assets expropriation (Blonigen, 2005).
However, governments interested in attracting FDI to boost job creation, new technologies, and tax revenues to their countries are not only concerned about the internal institutional environment. They are also competing with other countries in attracting foreign investments, engaging in what is often referred to as “jurisdictional competition”. In a broad sense, this can be thought of as governments’ efforts to outcompete one another in offering foreign companies more favorable institutional and fiscal conditions for capital placements.
This brief summarizes the results of a study on the jurisdictional competition for FDI among the developing CEE and among developed EU countries (Mazol and Mazol, 2021). The research explores the precondition for proactive jurisdictional competition between economies for FDI – namely, how the economic and institutional environment within a country impacts the inflow of FDI both domestically and to its neighboring states, – by using a spatial econometric approach. The brief emphasizes the difference in the FDI policy responses implemented by developing CEE and developed EU countries.
Data and Methodology
In our econometric analysis, we use the FDI inward stock (i.e., the value of capital and reserves in the economy attributable to a parent enterprise resident in a different economy) as the dependent variable. The explanatory variables indicating jurisdictional competition include quality of corporate governance, rule of law, political stability, and tax policy. We employ balanced panel datasets for 26 developing CEE countries and 15 developed EU countries for the period 2006-2018. The dataset is derived from the World Bank and UNCTAD databases.
The analysis is based on a panel spatial Durbin error model (SDEM) with fixed effects (LeSage, 2014). Parameter estimates in the SDEM contain a range of information on the relationships between spatial units (in our case, countries). A change in a single observation associated with any given explanatory variable will affect the spatial unit itself (a direct effect) and potentially affect all other spatial units indirectly (a spillover effect) (Elhorst, 2014). The spatial spillover effect is viewed here as the impact of the change in the institutional or economic factor in one country on the performance of other economies (LeSage & Pace, 2009).
In our case, the direct effect is the effect on the FDI in country i of the changes in the studied instrument of jurisdictional competition in country i. The spillover effect is the change in FDI in country j following a change in the studied instrument of jurisdictional competition in country i.
Results
The results of our estimation are suggestive of a proactive jurisdictional competition in taxes among the CEE countries and in corporate governance quality both among the CEE and EU countries. Analyses of other factors (i.e., political stability and rule of law) show no significant interrelation between policy measures implemented by neighboring countries in order to attract FDI.
The precondition for the presence of proactive jurisdictional competition in a particular factor is to have statistical significance in both its direct and spillover effects (Elhorst and Freret, 2009). Such findings may indicate that policy measures in one economy trigger a policy response in a neighboring economy, which, in turn, influences the level of FDI in both countries.
Table 1. Estimation results of SDEM models – direct effects
Notes: *** – significance at 1% level, ** – significance at 5% level, * – significance at 10% level. ln – denotes the logarithm of the underlying variable. lagt – denotes lagged underlying variable by one period (year) in time. Values of t statistics in parenthesis. CEE countries: Albania, Armenia, Azerbaijan, Belarus, Estonia, Bosnia and Herzegovina, Bulgaria, Croatia, Czech Republic, Georgia, Hungary, Kazakhstan, Kyrgyz Republic, Latvia, Lithuania, Macedonia, Moldova, Poland, Romania, Russia, Serbia, Slovakia, Slovenia, Tajikistan, Ukraine, Uzbekistan. EU countries: Austria, Belgium, Denmark, Finland, France, Germany, Greece, Italy, Luxembourg, Netherlands, Norway, Portugal, Spain, Sweden, Switzerland. Source: Author’s estimates based on World Bank and UNCTAD databases.
Our results for the direct and indirect response to a tax policy in CEE countries illustrate this logic. Decreasing tax_rateincreases FDI to the CEE economy enacting this change (see Table 1), as well as to its neighboring countries (see Table 2). This finding is consistent with jurisdictional competition in taxes. That is, a reduction in domestic tax_rate may entail a decrease in the tax rate of a neighboring economy, resulting in a subsequent increase in FDI. (To explicitly confirm the suggested channel, further tax policy analysis would be needed). Interestingly, our results suggest that jurisdictional competition in taxes is only present among CEE economies, but not among EU countries.
In turn, an increase in corp_governance, a measure of corporate governance quality, increases FDI in neighboring countries both in the EU and in the CEE region (see Table 2). A possible interpretation is that an increase in corp_governance in one country may entail an increase in corp_governance in its neighboring economies, resulting in a subsequent increase in FDI. This result suggests proactive competition via corporate governance policy both among the EU countries and the CEE countries.
However, the direct effect differs between the regions. In the EU, an increase in corp_governance increases FDI to the EU economy in question, in line with common wisdom (see Table 1). At the same time, in the CEE region, an increase in corp_governance is followed by a decrease in FDI to that country.
Table 2. Estimation results of SDEM models – spillover effects
Notes: *** – significance at 1% level, ** – significance at 5% level, * – significance at 10% level. ln – denotes the logarithm of the underlying variable. Values of t statistics in parenthesis. lagt_lags – denotes spatially lagged underlying variable (multiplied by spatial weight matrix) lagged by one period (year) in time. Source: Author’s estimates based on World Bank and UNCTAD databases.
One potential explanation for the negative direct effect of corporate governance quality on FDI in the CEE economies is that improved corporate governance practices can block certain types of FDI, leaving behind foreign investors with a lower “threshold for corruption”. This may decrease FDI to the CEE country in question. However, once the jurisdictional competition results in an improvement of corporate governance across the region, it ultimately has a positive spillover effect.
The above explanation is in line with the theory of regulatory capture (Stigler, 1971), which suggests that the decisions made by public officials might be shaped and sometimes distorted by the efforts of rent-seeking interest groups to increase their influence.
Finally, the estimates do not indicate that the other studied institutional factors, rule of law and political stability, are applied as instruments of jurisdictional competition as neither groups of countries show significant spillover effects. The results, however, show that these factors influence the FDI inflow via the direct effect. More specifically, an increase in political_stability positively influences the FDI inflow to the economies in question, both in CEE and the EU, while rule_of_law is positive and significant only for the CEE countries. If investors are not as responsive to changes in rule_of_law when the initial level is high, the fact that EU countries typically have a higher rule_of_law value compared to CEE countries might explain why this estimate is insignificant for the EU countries.
Conclusion
This brief, first, presents new evidence on the relationship between different economic and institutional factors and FDI using a spatial econometric approach; second, it analyzes the possible existence of jurisdictional competition among developing CEE countries and developed EU countries as well as its effect on FDI.
The results suggest proactive jurisdictional competition in FDI determinants such as corporate governance quality and tax rates. CEE countries competing with one another use both these instruments of jurisdictional competition, while EU countries compete only via corporate governance quality. Furthermore, foreign investors are not sensitive to the quality of rule of law in the EU countries, while this instrument is more important for the FDI inflow to CEE economies.
Our results stress that officials responsible for the FDI policy implementation should pay more attention to the policies undertaken by neighboring governments as such external policies can make their own strategies to attract FDI to their economy less effective.
References
- Blanton, S., and R. Blanton. (2007). What Attracts Foreign Investors? An Examination of Human Rights and Foreign Direct Investment. The Journal of Politics, 69(1), 143-155.
- Blonigen, B. (2005). A Review of the Empirical Literature on FDI Determinants. Atlantic Economic Journal, 33(4), 383-403.
- Elhorst, J. (2014). Spatial Econometrics from Cross-Sectional Data to Spatial Panels. Berlin: Springer.
- Elhorst, J., and S. Freret. (2009). Evidence of Political Yardstick Competition in France Using a Two-Regime Spatial Durbin Model with Fixed Effects December. Journal of Regional Science, 49(5), 931-951.
- IMF (2003). World Economic Outlook 2003. International Monetary Fund: Washington DC.
- LeSage, J. (2014). What Regional Scientists Need to Know About Spatial Econometrics? Working Paper, Texas State University-San Marcos, San Marcos.
- LeSage, J., and R. Pace. (2009). Introduction to Spatial Econometrics. Boca Raton, FL: CRC Press, Taylor and Francis Group.
- Mazol, A., and S. Mazol. (2021). Competition of Jurisdictions for FDI: Does Developing and Developed Countries Response Different to Economic Challenges? BEROC Working Paper Series, WP no. 73.
- Stigler, G. (1971). The Theory of Economic Regulation. Bell Journal of Economic and Management Science, 2, 3-21.
Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.
Why Are Women Underrepresented in Politics: Exploring Causes and Solutions
Why are women underrepresented in politics? Despite progress in gender equality, women are still significantly underrepresented in political offices worldwide, especially in higher-level positions. This issue has drawn increasing attention in both academic and policy circles.
Recent research in economics and political science explores the key reasons why women are underrepresented in politics, often categorizing them into “supply-side” and “demand-side” factors. Supply-side factors include women’s potentially lower willingness or ability to run for political office, influenced by social norms, family responsibilities, or lack of political networks. On the demand side, voter and party leader biases against women candidates play a significant role in limiting opportunities for women to hold political office.
Understanding why women are underrepresented in politics is critical for designing effective policies that address the gender gap in political representation. Solutions such as gender quotas, political leadership training for women, and reforms to reduce bias have been proposed. We review some of these strategies and assess their effectiveness based on available evidence.
By tackling the root causes of why women are underrepresented in politics, we can create more inclusive political systems that better reflect the diverse populations they serve.
Country Reports
| Belarus country report (EN) | Belarussian language version (BY) |
| Georgia country report (EN) | Georgian language version (GE) |
| Latvia country report (EN) | Latvian language version (LV) |
| Poland country report (EN) | Polish language version (PL) |
| Russia country report (EN) | Russian language version (RU) |
| Ukraine country report (EN) | Ukrainian language version (UA) |
Women in Politics: Why Are They Under-represented?
Women are generally under-represented in political offices worldwide, and their under-representation becomes larger in more senior positions. Of the four dimensions considered in the World Economic Forum’s Gender Equality Index (namely, Economic Opportunity and Participation, Educational Attainment, Health and Survival and Political Empowerment), the dimension called Political Empowerment, which measures the extent to which women are represented in political office, records the poorest performance, with only 25% of an hypothetical 100% gap having been closed to date.
Importantly, although there is large variation across countries, gender inequality in political empowerment is documented in every region worldwide, including in those countries that are most socially and economically advanced. Sweden, for instance, while having a good record of women’s representation in most institutions (women currently represent 47.5% of the Parliament members, 54.5% of the ministers, and about 43% of the municipal councilors), has never had a woman as Prime minister, and only one-third of its mayors are female. Countries in Eastern Europe and Central Asia have only closed 15% of a hypothetical 100% gender gap in political empowerment, according to the World Economic Forum, by far their worst performance among the four sub-indexes that compose the overall Gender Equality Index.
Given the persistent under-representation of women in political institutions, where important decisions that shape societies are taken, economists and political scientists, among others, are increasingly interested in understanding the causes of the gender gap in political representation. In this brief, some of the recent academic literature on this question is summarized, and some policies that may help to close the gender gaps in political representation are reviewed.
Table 1. World Economic Forum Gender Equality Index. Regional Performance in 2020, by Sub-index
Table 1. World Economic Forum Gender Equality Index. Regional Performance in 2020, by Sub-index
Why Are Women Under-represented in Political Office?
Broadly speaking, three main reasons are most often explored, namely women’s unwillingness to become politicians, voters’ bias, and parties’ bias. Below an overview of some of the work that has addressed each of these three factors is provided.
Gender Gaps in Political Ambition
Large-scale surveys have documented that women who, based on their professional and economic credentials, are potential political candidates, report lower ambition to occupy executive offices than comparable men (Fox and Lawless, 2004). The main reasons for the gender gap in ambition appear to be that
- (a) women are less encouraged to run for office than men and
- (b) women are less likely to believe that they are qualified for office than men.
Women’s tendency to shy away from competition (Niederle and Vesterlund, 2007) may also play a role since the political selection process is likely perceived as highly competitive. As Preece and Stoddard (2015) find by using two experiments, priming individuals to consider the competitive nature of politics lowers women’s interest in running for political office, whereas it has no effect on the interest of men.
Women’s willingness to advance in their political careers can also be influenced by family and relational considerations. Recent work from Folke and Rickne (2020) shows that in Sweden female politicians who are promoted to mayor (i.e. the highest office in municipal politics) experience a significant increase in the likelihood of divorcing their partner, whereas this is not the case for men. If women face higher costs for their career achievements, as the evidence in Folke and Rickne (2020) suggests, they may be discouraged from pursuing such objectives.
While there is evidence that women may on average be less willing to advance to top positions than men, it is not clear how quantitatively relevant this factor is to account for the lack of women in power. The introduction of gender quotas in candidate lists in different countries worldwide can be informative in this sense. If women’s under-representation in electoral lists is mostly due to the lack of qualified female politicians, some electoral lists (in most cases representing specific political parties) may not be able to run due to the introduction of a quota, and the average “quality” of lists, measured by some relevant (to voters) characteristics of their members, would decrease. The literature finds no evidence of either of these two responses to quotas (see Baltrunaite et al., 2014, Besley et al., 2017, Bagues and Campa, 2020). On the contrary, in Italy (Baltrunaite et al., 2014) and Sweden (Besley et al., 2017) quotas appear to have improved the “quality” of the elected politicians.
Voters’ Bias
Krook (2018) observes that the existing work in political science regarding the importance of voters’ bias in explaining women’s underrepresentation in politics leads to ambivalent conclusions. Results in the most recent economics literature confirm this assessment. Barbanchon and Sauvagnat (2019) compare votes received by the same female candidate in French parliamentary elections across different polling stations within an electoral district and find that votes for women are lower in municipalities with more traditional gender-role attitudes. They interpret this pattern as evidence of voters’ discrimination and conclude that voters’ bias matters quantitatively in explaining women’s under-representation among politicians. Conversely, Bagues and Campa (2020) find no evidence of voters’ bias against women, based on voters’ reaction to the introduction of a gender quota for electoral lists in Spain. Specifically, they study how the quota impacts the electoral performance of lists that were more affected by the quota – i.e. that were forced to increase their share of female candidates by a larger extent, due to their lower level of feminization pre-quota. They do not find evidence that such lists have worsened their relative electoral performance due to the quota. Put differently, there is no evidence that voters lower their electoral support of a list when its share of female candidates increases for exogenous reasons.
Survey data on voters’ attitudes can also help in gauging the extent to which voters discriminate against women. Based on data from the latest wave of the World Value Survey (WVS, 2017-2020), in Western Europe typically less than 20% of survey respondents express agreement with the statement “Men make better political leaders than women do” (e.g. 5% in Sweden, 9% in Denmark and Germany, 12% in Finland and France, 19% in Italy; only in Greece the share of the agreement is higher than 20%, at 26%). As shown in Figure 1, these percentages are substantially higher in Eastern Europe and Central Asia.).
Figure 1. Share of survey respondents who report to “Agree” or “Strongly Agree” with the statement “Men make better political leaders than women do”.
Notes: Data are based on the latest wave of the World Value Survey, 2017-2020. The countries selected were either part of the former Soviet Union or under direct Soviet influence before 1990.
It bears noting, however, that answers to the WVS are not always informative about the extent to which voters’ bias prevails in a country. Where the percentage of respondents who think that men make better political leaders than women is close to or above 50%, as e.g. in Armenia, Georgia, or Russia, voters’ bias is likely to be an important factor. However, in countries with lower levels of agreement, such as for instance Poland, drawing conclusions is harder, since the WVS does not measure the share of respondents who think that women make better political leaders than men do.
Parties’ Bias
Party leaders, who often are key players in the selection of politicians, may prefer to promote male rather than female candidates. If they are aware of voters’ bias against women, preferring male candidates is consistent with a votes-maximizing strategy. However, party leaders may also act as gate-keepers and hold women back even in absence of voters’ bias. Esteve-Volart and Bagues (2012) find evidence of an agency problem between voters and parties by looking at Spanish elections. While parties tend to nominate women in worse positions on the ballot, there is no evidence that women attract fewer votes than men; moreover, when the competition is stiffer, women’s position on the ballot improves. These two facts lead the authors to conclude that the disadvantage women face can likely be attributed to parties’ rather than voters’ bias.
When considering all these factors, it is also important to note that the systematic under-representation of women in political institutions is likely self-reinforcing, due to gendered group dynamics. In the laboratory, women in male-majority teams appear significantly less likely to put their name forward as team-leaders than women in female-majority teams; they anticipate, correctly, lower support from team members (see Born et al., 2019). Female mayors in Italy are significantly more likely to be removed by their municipal councils than their comparable male colleagues; importantly, this is especially true when the share of male councilors is particularly large (Gagliarducci and Paserman, 2011). These studies suggest that, since the political arena has been historically male-dominated, gendered group dynamics can create vicious cycles of women’s under-representation.
Which Policies Can Be Used to Increase Women’s Representation in Political Institutions?
Different policies can be considered to address the various factors accounting for women’s under-representation in politics. In an attempt to address the ”supply-side’’ aspect of women’s under-representation, various non-profit organizations have offered training programs aimed at providing women with knowledge, skills, and networks to build political careers (see, for instance, NDI 2013). While reviewing the existing literature on these programs is beyond the scope of this brief, to the best of the author’s knowledge, there is little to no research-based evidence on the quantitative impact of training on women’s advancements in politics. Non-profit organizations, political parties, and researchers may fruitfully collaborate to implement and systematically test training programs.
Gender quotas are the most commonly used policy intervention, especially those regulating the composition of candidate lists, and they have been extensively studied; overall the literature suggests that quotas are more or less effective in empowering women depending on their design and the context where they are used (see Campa and Hauser, 2020 for a more comprehensive review of the economics literature on gender quotas and related policy implications). Given the nuances in the functioning of quotas, countries or regions that consider their adoption should consult with experts who know the ins and outs of such policies and combine their expertise with local knowledge of the relevant context.
The structure and distribution of power within parties are likely crucial for improving women’s political representation. Some scholars have devoted attention to the role of women’s organizations within parties. Theoretically, such organizations should favour the creation of networks and offer mentorship services, which are likely crucial to climb the career ladder in politics. In Sweden, a coalition of women from both the right and the left is credited for having pressed the Social Democrats’ into adopting their internal zipper quota by threatening to form a feminist party (see Besley et al., 2017). Women’s wings within political parties could play a similar role. Kantola (2018) notes that women’s organizations seem to be currently deemed as outdated, at least in European parties; Childs and Kittilson (2016), on the other hand, find that their presence does not seem to harm women’s promotion to executive roles within parties, a concern that has been associated with the existence of such organizations. In countries with public funding of political parties, specific funds could be directed to women’s organizations within parties.
Folke and Rickne (2020) also note that, since women in top jobs appear to face more relational and family constraints than men, policies that improve the distribution of economic roles within couples could help address the under-representation of women in positions of political power; their observation underlines the crucial role of gender-role attitudes in affecting women’s empowerment in any area of society. How can these attitudes change? An increasing amount of research is being devoted to answering this question. Campa and Serafinelli (2019), for instance, show that a politico-economic regime that puts emphasis on women’s inclusion in the labor market can change some of these attitudes. More research from different contexts and on specific policies will hopefully provide more guidance for policy makers on this important aspect, but the message from the existing research is that gender-role attitudes can be changed, and therefore policy-makers should devote attention to interventions that can influence the formation of such attitudes.
In many Western democracies, the rate of progress in women’s access to top political positions has proven especially slow. This history of Western democracies and the existence of the self-reinforcing mechanisms described above can serve as a lesson for countries in transitions, where new political organizations and institutions are emerging. In absence of specific policies that address women’s under-representation at lower levels very early on, it would likely take a very long time before gender gaps are closed at higher levels of the political hierarchy.
In conclusion, the authors observe that constant monitoring of the gender gaps in political institutions is important, even in presence of clear upward trends, since progress is rarely linear and therefore needs continuous nurturing.
About FROGEE Policy Briefs
FROGEE Policy Briefs is a special series aimed at providing overviews and the popularization of economic research related to gender equality issues. Debates around policies related to gender equality are often highly politicized. We believe that using arguments derived from the most up to date research-based knowledge would help us build a more fruitful discussion of policy proposals and in the end achieve better outcomes.
The aim of the briefs is to improve the understanding of research-based arguments and their implications, by covering the key theories and the most important findings in areas of special interest to the current debate. The briefs start with short general overviews of a given theme, which are followed by a presentation of country-specific contexts, specific policy challenges, implemented reforms and a discussion of other policy options.
Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.
Addressing the COVID-19 Pandemic: Vaccination Efforts in FREE Network Countries
There are great expectations that vaccinations will enable a return to normality from Covid-19. However, there is massive variation in vaccination efforts, vaccine access, and attitudes to vaccination in the population across countries. This policy brief compares the situation in a number of countries in Eastern Europe, the Baltics, the Caucasus region, and Sweden. The brief is based on the insights shared at a recent webinar “Addressing the COVID-19 pandemic: Vaccination efforts in FREE Network countries” organized by the Stockholm Institute of Transition Economics.
Introduction
As of February 16, 2021, the total number of confirmed COVID-19 deaths across the globe has reached 2.45 million according to Our World in Data (2021). Rapid implementation of vaccination programs that extend to major parts of the population is of paramount importance, not only from a global health perspective, but also in terms of economic, political, and social implications.
Eastern Europe is no exception. Although many countries in the region had a relatively low level of infections during the first wave of the COVID-19 pandemic in the spring of 2020, all have by now been severely affected. Vaccination plays a key role for these economies to bounce back, especially as many of them depend on tourism, trade, and other sectors that have been particularly hurt by social distancing restrictions.
Figure 1. Cumulative confirmed COVID-19 cases (top panel) and deaths per million (bottom panel) in the FREE Network region
Source: John Hopkins University CSSE COVID-19 visualizations: Ourworldindata.org/coronavirus
Against this background, the Stockholm Institute of Transition Economics invited representatives of the FREE Network countries to discuss the current vaccination efforts happening in Eastern Europe, the Baltics, and the Caucasus (the represented countries were Belarus, Georgia, Latvia, Poland, Russia, Sweden, and Ukraine). This brief summarizes the main points raised in this event.
Vaccination Status
In Latvia, Poland, and Sweden, the second wave of infections started to pick up in November 2020 and peaked according to most COVID-19 impact measures in early 2021. As all three countries are members of the EU and take part in its coordinated efforts, they have all received vaccines from the same suppliers (i.e. Astra/Zeneca, Moderna, and Pfizer/BioNTech).
Latvia had problems early on with getting the vaccination process off the ground. The health minister was blamed for the slow start since he declined orders from Pfizer/BioNTech in the early stages, and was forced to resign. As of February 16, two doses per 100 people have been distributed primarily to medical staff, social care workers, and key-state officials.
Figure 2. Cumulative COVID-19 vaccination doses per 100 people
Source: Our world in data, last updated February 24th, 2021. This is counted as a single dose, and may not equal the total number of people vaccinated. Visualizations: Ourworldindata.org/coronavirus
With the first phase starting in late December, Sweden has by February 16th, 2021, fully vaccinated 1,05% of the population while experiencing serious problems with delivery and implementation. As planning and delivery of vaccines are centralized while the implementation is decided regionally, there have been some unclarities regarding who stands accountable for issues that emerge. Guidelines, issued by the Public Health Agency of Sweden, for how to prioritize different groups have been changed a couple of times. Currently, the (non-binding) recommendation is to prioritize vaccinating people living in elderly care homes, as well as personnel working with this group, followed by those above 65 years of age, health care workers, and other risk groups.
Looking at regional statistics there are significant differences in vaccinating people across regions with an average of 70% usage rate of delivered vaccines, and with lows at 40-60%, see figure 3. Reasons for this remain unclear.
Figure 3. Distributed relative to delivered vaccines across counties (län) in Sweden.
Source: Authors’ calculations based on data collected by the Public Health Agency of Sweden. Last updated February 14th, 2021.
Poland has so far been somewhat more efficient than Sweden in its vaccination efforts. Despite turbulent political events over the last couple of months, it has managed to distribute 5.7 doses per 100 people. The country has just finished the first phase of the national vaccination plan, which focused on vaccinating healthcare personnel, and has now entered the second phase with a shifted focus towards elderly care homes, people above 60 years of age, military, and teachers.
Among the countries that are not members of the EU, and thus, not taking part in its coordinated vaccination efforts, the vaccination statuses are more diverse.
Russia was fast in developing and approving the Sputnik V vaccine. The country started vaccinating in early December, although only people in the age of 18-60 in prioritized occupations such as health care workers, people living and working in nursing homes, teachers, and military. At the start of 2021, the program extended to people above 60 and, on January 16, all adults were given the possibility to register themselves and get vaccinated within one week. There are no precise data at the moment, but the fraction of the population vaccinated is likely to be higher than 1%.
Others in the region have faced greater challenges in signing contracts with vaccine suppliers. Georgia and Ukraine are still waiting to secure deliveries and have not yet started to vaccinate. Being outside the EU agreements and with public and political mistrust towards Sputnik V and Russia alternatives are being explored. Georgia has ordered vaccines through the COVAX platform (co-led by Gavi, the Coalition for Epidemic Preparedness Innovations (CEPI) and WHO) but there are concerns about potential delays in deliveries. In terms of prioritizing groups once vaccinations can start, both Ukraine and Georgia have set similar priorities as other countries, with extra focus on health-care and essential workers, age-related risk groups, and people with chronic illnesses.
While Belarus’ official figures on the death toll have been widely perceived as unrealistic from the beginning, the most accurate and recent data shows an excess deaths rate of about 20% in July. The country has no precise data on vaccinations, but some reports have emerged based on interviews with government officials in the Belarusian media. These suggest that around 20,000 imported doses of Sputnik V have been distributed mainly to medical professionals and an additional 120,000-140,000 doses have been promised by Russia.
Main Challenges
The discussion during the Q&A session at the webinar concerned the economic and political implications of vaccinations in the region.
Pavlo Kovtoniuk, the Head of Health Economics Center at KSE in Ukraine, stressed the importance of a coordinated vaccination effort in Europe with regards to geopolitics. There is a clear EU vs Non-EU divide in the vaccination status across European countries. The limited vaccine availability in Non-EU countries such as Ukraine, Georgia, and Belarus offers opportunities for more influential nations like Russia and China to pressure and affect domestic policy in these countries.
Also highlighting the fact that no one is safe until everybody is safe, Lev Lvovskiy, Senior Research Fellow at BEROC in Minsk, noted that vaccination efforts in Europe are important for recovery in small open economies like Belarus as many of its trade partners currently have imposed temporary import restrictions.
Similar to the political crisis happening alongside the pandemic in Belarus, the challenges we see in Poland – protests against the recent developments regarding abortion rights and attempts by the government to limit free media – have deflated the urgency to vaccinate in terms of its future economic and political implications, according to Michal Myck, director of CenEA in Szczecin.
Looking forward, another major challenge for the region is vaccine skepticism. Not only do many countries have to build proper infrastructure that can administer vaccines at the required scale and pace, but also make sure that people actually show up. In Latvia, Poland, Georgia, Russia, and Ukraine, polls show that less than 50% of the population are ready to vaccinate. Sergejs Gubin, Research Fellow at BICEPS in Riga, highlighted that there can be systematic variation in the willingness to vaccinate within countries as e.g. Russian-speaking natives in Latvia have been found to be less prone to vaccinate on average. Also, most of the skepticism in Georgia has been more directed towards the Chinese and Russian vaccine than towards those approved by the EU, according to Yaroslava Babych who is lead economist at ISET in Tbilisi.
Even though vaccine skepticism is an issue in Russia too, Natalya Volchkova, Director of CEFIR at New Economic School in Moscow, pointed to the positive impact of “bandwagon effects” in vaccination efforts. When one person gets vaccinated, that person can spread more accurate information about the vaccine to their social circle, resulting in fewer and fewer people being skeptical as the share of vaccinated grows. In such a scenario vaccine skepticism can fade away over time, even if initial estimates suggest it is high in the population.
Concluding Remarks
Almost exactly a year has passed since Covid-19 was declared a pandemic. The economic and social consequences have been enormous. Now vaccines – developed faster than expected – promise a way out of the crisis. But major challenges, of different types and magnitudes across the globe, still remain. As the seminar highlighted, there are important differences across transition countries. Some countries (such as Russia) have secured vaccines by developing them, but still face challenges in producing and distributing vaccines. Others have secured deliveries through the joint effort by the EU, but this has also had its costs in terms of a somewhat slower process (compared to some of the countries acting on their own) and sharing within the EU. For some other countries, like Belarus, Ukraine, and Georgia, the vaccination is yet to be started. All in all, the choice and availability of vaccines across the region illustrates how economic and geopolitical questions remain important. Finally, for many of the region countries vaccine skepticism and information as well as disinformation are important determinants in distributing vaccines. Summing up, the combination of these factors once again reminds us that how to best get back from the pandemic is truly a multidisciplinary question.
List of Participants
- Iurii Ganychenko, Senior researcher at Kyiv School of Economics (KSE/Ukraine)
- Jesper Roine, Professor at Stockholm School of Economics (SSE) and Deputy Director at the Stockholm Institute of Transition Economics (SITE/ Sweden)
- Lev Lvovskiy, Senior Research Fellow at the Belarusian Economic Research and Outreach Center (BEROC/ Belarus)
- Michal Myck, Director of the Centre for Economic Analysis (CenEA/ Poland)
- Natalya Volchkova, Director of the Centre for Economic and Financial Research New Economic School (CEFIR NES/ Russia)
- Pavlo Kovtoniuk, Head of Health Economics Center at Kyiv School of Economics (KSE/Ukraine)
- Sergej Gubin, Research Fellow at the Baltic International Centre for Economic Policy Studies (BICEPS/ Latvia)
- Yaroslava V. Babych, Lead Economist at ISET Policy Institute (ISET PI/ Georgia)
Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.
Video of the FREE Network webinar “Addressing the Covid-19 Pandemic: Vaccination Efforts in Free Network Countries“
Media Freedom in Eastern Europe
In recent years, press freedom in many Eastern European countries has increasingly come under threat. This policy brief provides an overview of the importance of a free press for democracy and the challenges to media freedom in these European transition economies.
Introduction
Freedom of expression – which encompasses media freedom – is a fundamental human right enshrined in most countries’ constitutions. Yet for many of their citizens, it is more of an aspiration than a reality. Following the dissolution of the Soviet Union, a number of countries in Eastern Europe embarked on a process of democratisation and accession to the European Union – for which one of the prerequisites is a free press.
Figure 1 shows a measure of press freedom for the eight Eastern European countries that joined the EU in 2004. These countries saw a general improvement in press freedom from the early 1990s to the early 2000s. But since then, experiences have diverged and in 2017 only Estonia and the Czech Republic showed better scores on press freedom than when they first joined the EU. This pattern of backsliding is not confined to the media, but is also evident in other measures of democracy.
Figure 1. Media Freedom in Eastern Europe
Media and Democracy
A free press and a strong democracy are mutually reinforcing. Research, from mainly Western democracies, shows that the media plays an important role in informing the electorate and holding politicians accountable. For example, Snyder and Strömberg (2010) find that U.S. voters are less informed about their Congressmen when they are covered less in the local press. This is ultimately damaging for voters, as these politicians work less for their constituency and these constituencies also receive less federal funding.
Investigative journalism can play an important role in uncovering corruption and other forms of wrongdoing by politicians. For instance, using the Panama Papers and other leaked documents, journalists uncovered 11,562 offshore entities linked to Russia, 2943 linked to Latvia, and 103 linked to Sweden (see: Offshore Leaks Database). While there are legitimate uses for these offshore entities, the lack of transparency surrounding offshore finance also facilitates tax evasion and money laundering. The revelations of offshore holdings became an embarrassment to many politicians, with some forced to resign. In Russian media, the allegations that the leaks document suspected money laundering by President Putin were characterised as US propaganda (Hoskins and Shchelin, 2018).
Figure 2 shows the relationship between the length of time a country’s leader has been in office and its press freedom score in 2020. While there is no systematic relationship between leader tenure length and press freedom in Western Europe (in blue), across Eastern Europe (in red), countries whose leader has been in power for longer tend to have less media freedom. This correlation is likely to reflect three factors: 1) media coverage can affect a government’s chances of staying in power; 2) a longer-lived government might be more able to control the media and 3) a host of other factors, such as the public’s political engagement and the strength of democratic institutions, could influence both freedom of the press and the longevity of governments.
Figure 2. Media Freedom and Leader Tenure
Source: Freedom of the Press, Freedom House. This figure shows the Freedom of the Press total score for the 8 central and eastern European countries that joined the EU in 2004 from 1993 to 2017. A country with a score between 0 and 30 (31 and 60) is designated as having a free (partly free) press.
Electoral Effects of the Media
A number of papers show the causal effects of (biased) media coverage in shaping support for political parties. For instance, watching Fox News increases voting for the Republican party in the US (DellaVigna and Kaplan, 2007; Martin and Yurukoglu, 2017).
Enikolopov, Petrova, and Zhuravskaya (2011) investigate the influence of NTV (the only national TV channel that was at the time independent of the government) on voting in the 1999 parliamentary election in Russia. They find that areas with greater access to NTV were significantly less likely to vote for the government party and more likely to vote for opposition parties.
Biased media can also be used as a foreign policy tool. Peisakhin and Rozenas (2018) find that Ukrainian areas that received Russian TV had on average greater support for pro-Russian parties and candidates in the 2014 elections.
The media landscape in many CEE countries is highly polarised and politicised. Kostadinova (2015) cites research showing that in some former communist countries many journalists still rely on government officials as news sources. In other countries, media in opposition to the communist regimes emerged at the end of the 1980s, such as in Poland where the Gazeta Wyborcza became one of the leading daily newspapers.
Government Control of the Media
Governments have many ways of controlling the media in their country. At the extreme, governments can own and run media outlets, dictate their contents, and censor any dissenting voices. While political and media systems across CEE are diverse, they share some common experiences that might explain their current fragility.
Transitions in Media Ownership
In the Eastern Bloc, the mass media was owned and tightly controlled by the state and used as a tool for propaganda. After the fall of communism, many state-owned media were privatised – along with other state-owned enterprises. Foreign (mostly western European) media conglomerates purchased a significant fraction of media outlets in a number of countries.
While private and foreign ownership of the media can reduce the government’s ability to influence media content, the experience of CEE was not entirely positive. Stetka (2012) argues that while foreign owners brought capital and technology, they were less concerned with transplanting Western journalistic and professional standards. Dobek-Ostrowska (2015) claims that this focus on profit led to the tabloidisation of news across the CEE.
Following the global financial crisis in 2007/2008, foreign investors started to pull out of the CEE media markets and are being replaced by local owners who often have strong links with the government. This is evident in Hungary, where businessmen close to the government have been buying up independent media outlets, including its largest news website, one of two national commercial TV channels, and all regional newspapers (Bede, 2018). The Polish government also aims to “re-nationalise” its media. Plans by a state-run oil company to buy one of the country’s largest media publishers from its German owners were recently approved.
Elsewhere, domestically owned and previously independent media outlets are also being bought by new pro-government owners. In Russia, the formerly independent NTV from the above example was taken over by a state-owned company in 2001 and started to cover the ruling party in the run-up to the following elections in a similarly favourable way to state-controlled TV channels. Gehlbach (2010) argues that Putin’s media strategy is to exert tight control over the news coverage of these three main national television networks, while allowing media outlets with less reach to operate more independently.
In some countries of the region, there is limited information about the ultimate owner of media outlets. Within the EU, Latvia, Hungary, the Czech Republic, Slovakia and Cyprus, are assessed as high risk in terms of transparency of media ownership (Brogi et al. 2020). In 2009, the Swedish company Bonnier sold Diena – one of Latvia’s largest newspapers – to an initially undisclosed investor. A year later, a Latvian businessman acquired a controlling stake in the paper.
Government Advertising
Around the world, traditional news media is facing increased competition from digital platforms and becoming highly dependent on advertising revenue, including advertising from the government and pro-government businesses According to the Centre for Media Pluralism and Media Freedom, there are no clear and fair criteria for the distribution of state advertising to the media in the majority of EU countries – especially those in Eastern Europe (with the exception of Estonia).
Szeidl and Szucs (2021) document how the Hungarian government targeted advertising to friendly media outlets and how these media in turn covered the government more positively. They also present suggestive evidence that a similar favour exchange between government and the media occurs in nine other Eastern European countries, including Poland.
Two weeks ago, many private Polish media outlets coordinated a media blackout to protest government plans to tax advertising revenues. The media companies complained that the tax would cost them $270m a year, while public media received twice as much from taxpayers.
Public Service Media
The establishment of public service media forms an integral part of the EU’s agenda for promoting press freedom. While public service media are an important and trusted source of unbiased information in many western European countries, they generally play a smaller role in the Eastern European media markets. Furthermore, no laws are guaranteeing the independence of public service media from the government in eastern EU countries, with the exception of the Baltic states and Slovenia (see Centre for Media Pluralism and Media Freedom).
Intimidation of Journalists
Governments can also ensure positive coverage by intimidating editors and journalists. Since 1992, 91 journalists were killed, imprisoned, or went missing in Russia, 18 in Ukraine, 15 in Belarus, and 8 in Georgia (data by the Committee to Protect Journalists). While not all of these cases reflect government action, several recent examples illustrate how the judicial system may be used against journalists. For instance, according to the CPJ, ten journalists were imprisoned in November 2020 for covering protests against President Lukashenko in Belarus and one journalist was charged with high treason and espionage in Russia in July 2020.
There are also fears that governments can use defamation laws to deter and punish unwelcome media reports. For instance, the head of Poland’s ruling party filed a libel charge against two journalists from the Gazeta Wyborcza for reporting about his alleged involvement in a real estate project (see, e.g. Council of Europe media freedom alert).
Conclusion
The media plays a vital role in shaping the public debate and holding those in power accountable to the wider population. This power of the media also increases the risk that governments attempt to influence media content.
In recent years, many countries in CEE have seen press freedom come increasingly under threat, undermining some of the progress made since the dissolution of the Soviet Union. Part of the present fragility of media freedom in Eastern Europe may be due to their historical experience. During the transition from communism, many formerly state-owned media companies were sold to private and often foreign owners. In the past decade, local business interests with strong ties to the government started to buy up large shares of the media market in a number of Eastern European countries. Meanwhile, public service media have been less successful at establishing themselves as important and unbiased sources of information across Eastern Europe compared to Western Europe. To ensure positive media coverage, many governments adopt a carrot and stick approach: state advertising revenues and intimidation of individual journalists.
Article 19 of the Universal Declaration of Human Rights states that “everyone has the right to freedom of opinion and expression; this right includes freedom to hold opinions without interference and to seek, receive and impart information and ideas through any media and regardless of frontiers”. To ensure these fundamental rights, there need to be transparent and fair rules governing the ownership, management, and financing of media outlets and safeguards for individual journalists.
References
- Bede, Márton, 2018. “As elections loom, stakes are raised for Hungarian media.” International Press Institute.
- Brogi, Elda, Roberta Carlini, Iva Nenadic, Pier Luigi Parcu and Mario Viola de Azevedo Cunha, 2020. ”Monitoring Media Pluralism in the Digital Era.”, Centre for Media Pluralism and Media Freedom Report.
- DellaVigna, Stefano, and Ethan Kaplan. “The Fox News effect: Media bias and voting.” Quarterly Journal of Economics 122, no. 3 (2007): 1187-1234.
- Dobek-Ostrowska, Bogusława, 2015. “25 years after communism: four models of media and politics in Central and Eastern Europe”. In Democracy and media in Central and Eastern Europe 25 years on, 11-46. Publisher: Peter Lang Edition Editors: Bogusłąwa Dobek-Ostrowska & Michał Głowacki
- Enikolopov, Ruben, Maria Petrova and Ekaterina Zhuravskaya, 2011. “Media and political persuasion: Evidence from Russia.” American Economic Review, 101(7), pp. 3253-85.
- Gehlbach, Scott, 2010. “Reflections on Putin and the Media“, Post-Soviet Affairs, 26:1, 77-87.
- Hoskins, Andrew and Pavel Shchelin, 2018. “Information war in the Russian media ecology: the case of the Panama Papers.” Continuum, 32:2, 250-266.
- Kostadinova, Petia, 2015. “Media in the New Democracies of Post-Communist Eastern Europe.” East European Politics and Societies, 29 (2), 453–66.
- Martin, Gregory J., and Ali Yurukoglu, 2017. “Bias in cable news: Persuasion and polarization.” American Economic Review 107, no. 9: 2565-99.
- Peisakhin, Leonid and Arturas Rozenas. 2018. “Electoral Effects of Biased Media: Russian Television in Ukraine.” American Journal of Political Science, 62: 535-550.
- Snyder, James M., and David Strömberg, 2010. “Press Coverage and Political Accountability.” Journal of Political Economy, 118 (2), 355-408.
- Stetka, Vaclav. “From multinationals to business tycoons: Media ownership and journalistic autonomy in Central and Eastern Europe.” The International Journal of Press/Politics, 17: 4, 433-456.
- Szeidl, Adam, and Ferenc Szucs, 2010. “Media capture through favor exchange.” Econometrica, 89 (1): 281-310.
Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.
Addressing the Covid-19 Pandemic: Vaccination Efforts in Free Network Countries
COVID-19 vaccination efforts are now starting in several countries around the globe and many believe that this is the way out of the pandemic crisis. The Stockholm Institute of Transition Economics (SITE) in collaboration with the FREE Network is delighted to invite you to a webinar to share insights and knowledge about how countries in Eastern Europe and around the Baltics are handling the vaccination efforts against the COVID-19 crisis.
How Are Countries in Eastern Europe, Around the Baltic Sea, and in the Caucasus Managing Vaccination Efforts?
With the pandemic still ongoing around the world and in many cases having entered both a second and third wave of infections and deaths—vaccination is urgently needed. Since the first vaccines against COVID-19 were approved, governments around the world are now pushing forward with the vaccination efforts – all with different strategies and methods. How are countries in Eastern Europe, around the Baltic Sea region and in the Caucasus region managing vaccination efforts in their countries and what are the key factors of success and failure? How different are the strategies?
Since the FREE Network includes research and policy institutes in Belarus (BEROC), Latvia (BICEPS), Russia (CEFIR at NES), Poland (CenEA), Georgia (ISET PI), Ukraine (KSE) and Sweden (SITE) the upcoming webinar will provide a comprehensive regional perspective on the vaccination efforts of different strategies implemented in these countries. Furthermore, the webinar will also shed light on how people have responded to vaccination offers; how other countries are being portrayed in the national media; and what the current discussions focus on.
The webinar is part of a series of online discussions aiming to provide a regional overview updates as well as in-depth analysis of specific topics related to the COVID-19 pandemic.
Join the webinar, learn more about the vaccination efforts in FREE Network countries and ask questions directly to distinguished panelists and experts:
Speakers
- Iurii Ganychenko, Senior researcher at Kyiv School of Economics (KSE/Ukraine)
- Jesper Roine, Professor at the Stockholm Institute of Transition Economics (SITE/ Sweden)
- Lev Lvovskiy, Senior Research Fellow at the Belarusian Economic Research and Outreach Center (BEROC/ Belarus)
- Michal Myck, Director of the Centre for Economic Analysis (CenEA/ Poland)
- Natalya Volchkova, Director of the Centre for Economic and Financial Research at New Economic School (CEFIR at NES/ Russia)
- Pavlo Kovtonyuk, Head of Health Economics Center at Kyiv School of Economics (KSE/Ukraine)
- Sergejs Gubins, Research Fellow at the Baltic International Centre for Economic Policy Studies (BICEPS/ Latvia)
- Yaroslava V. Babych, Lead Economist at ISET Policy Institute (ISET PI/ Georgia)
Chair/Moderator
- Torbjörn Becker, Director of the Stockholm Institute of Transition Economics (SITE)
Register here
RSVP Date: Thursday, February 11, 2021, 10:00am – 12:00pm (CET, Sweden)
Location: Online. A link to the webinar will be sent to you 4-5 hours ahead of the start of the webinar.
Registration: Will remain open until the start of the webinar.
Pollution and the COVID-19 Pandemic: Air Quality in Eastern Europe
The COVID-19 pandemic has drawn attention to a pre-existing threat to global health: the quality of air in cities around the world. Prolonged exposure to air pollution has been found to increase the mortality rate of COVID-19. This is a particular concern for much of Eastern Europe, where emissions regularly exceed safe levels. This policy brief analyses recent data on air quality in the region and the factors that explain a persistent East-West divide in pollution in Europe. It concludes by evaluating to what extent lockdowns in 2020 provided a temporary respite from pollution in the region.
Introduction
The WHO estimates that air pollution causes seven million premature deaths every year (WHO 2018). COVID-19 has further amplified these health risks, as air pollution can increase both the chance of catching respiratory diseases and their severity. At the same time, the pandemic has resulted in lockdowns and a general slowdown in economic activity which are widely perceived as having led to a temporary improvement in air quality.
This brief provides an overview of recent trends in air quality in Eastern European cities using data from the World Air Quality Index. It addresses three questions:
- How did air pollution in Eastern Europe compare to Western Europe prior to the pandemic?
- What are the main sources of air pollution in Eastern European cities and can they be addressed by policymakers?
- Was there a significant improvement in air quality in 2020 as a result of COVID-19?
Air Pollution in Eastern Europe
Most measures of air quality in Europe show a stark East-West divide. Map 1 plots the share of days in 2019 where air pollution, as measured by PM 2.5 (fine particulate matter), exceeded levels classified as unhealthy for the general population. On average, cities to the east of the former Iron Curtain experienced over 100 such days, compared to an average of 20 days in Western Europe. These averages mask significant variation within both regions; Tallinn was among the best performing cities while Naples was among the worst.
Map 1
Source: Author’s calculations based on data from the World Air Quality Index COVID-19 dataset. Above the threshold AQI of 150, PM 2.5 levels are classified as unhealthy to the general population by the US EPA.
The gap in air quality between Eastern and Western Europe has been linked to differences in health outcomes for decades. Shortly after the fall of the Soviet Union, Bobak and Feachem (1995) found that air pollution accounted for a significant share of the Czech Republic and Poland’s mortality gap with respect to Western Europe. The European Environment Agency’s 2020 report provides estimates for ‘years of life lost’ attributable to different pollutants. Figure 1, which plots these estimates for PM 2.5, highlights the fact that Eastern European countries, in particular those in the Balkans, continue to experience significantly higher mortality related to pollution, as compared to their Western European counterparts.
Figure 1
Source: estimates from EEA Air Quality in Europe report 2020
Sources of Air Pollution
A number of factors contribute to the pattern of pollution shown on Map 1, not all of which are under policymakers’ direct control. For example, two of the cities on the map with the unhealthiest air – Sarajevo and Skopje – are surrounded by mountains that prevent emissions from dissipating.
In addition to immutable geographic factors, policies elsewhere may also be contributing to pollution in the region. Stricter regulations in Western Europe can have adverse effects if they result in polluting industries migrating eastwards. Bagayev and Lochard (2017) show that as EU countries adopt new air pollution regulations, the share of their imports from Eastern Europe and Central Asia in pollution-intensive sectors increases. Stricter rules can also result in outdated technology being exported to other countries. A Transport & Environment report found that over 30,000 high-emission diesel cars were exported from Western Europe to Bulgaria in 2017 and argued that such flows will continue as Western European cities impose Low Emission Zones and diesel bans (Transport & Environment 2018).
Power generation, and in particular coal power, is likely to be the single most important determinant of the gap in air quality between Eastern and Western European cities. Coal power accounts for over 60% of electricity production in Poland, Serbia, Bosnia Herzegovina, and North Macedonia, and remains an important energy source in the majority of Eastern European countries (BP 2020). Many of the coal power plants in the region have been operating for decades and are not equipped with modern desulphurisation technology that would help to reduce their emissions. A report by the Health and Environment Alliance found that 16 coal power plants in the Western Balkans collectively produce more emissions than the 250 power plants in the European Union, while only being able to generate 6% of the power (Matkovic Puljic et al. 2019).
Countries in the region are taking steps to reduce their dependence on coal power. In September 2020, the Polish government struck an agreement with labour unions that would see coal phased out by 2049. Coal accounts for 75% of Poland’s current electricity and Map 1 shows that air in the Upper Silesian Coal Basin, in the south of the country, is particularly polluted. Despite such commitments, Western European countries have in recent years been faster at transitioning away from coal. If this trend continues, the gap in air quality may even increase in the short run.
Did COVID-19 Improve Air Quality?
Last spring, a number of headlines from around the world featured the phrase “A breath of fresh air” (e.g. Reuters, The Economic Times, EUIdeas). These articles described measurable improvements in air quality in cities with government-mandated lockdowns. Recent academic publications have confirmed these reports in a variety of settings including the US (Berman and Ebisu 2020), China (Chen et al. 2020), and Korea (Ju et al. 2020).
While Eastern Europe was less affected by the initial wave of COVID-19 than Western Europe, most countries imposed lockdowns and social distancing measures that can be expected to have affected air quality. Figure 2 uses daily data from the World Air Quality Index for 221 European cities to compare average air pollution in 2020 to 2019. Overall, these plots suggest that air quality did improve in Eastern European cities relative to the previous year. However, not all types of pollutants declined and the declines are slightly smaller on average than in Western European cities. Panels A, B, and C plot air quality indices for fine particulate matter (PM 2.5), nitrogen dioxide (NO2), and sulfur dioxide (SO2) respectively. Dots below the line represent cities where the average air quality index was lower (indicating less pollution) in 2020 than in 2019. The declines are largest for NO2 – a gas that is formed when fuel is burned. The reduction in traffic and transportation in all European cities is likely to have contributed to this drop. By contrast, there were no statistically significant declines in SO2. This may be due to the fact that power generation, which is the source of most SO2 emissions, was less affected by lockdowns than transportation.
Figure 2
Panel A
Panel B
Panel C
Source: Author’s calculations based on the World Air Quality Index COVID-19 dataset. Each marker represents a city. Markers below the 45-degree line represent cities where emissions for the respective category of pollutant were lower in 2020 than in 2019. For reasons of presentation, outliers were excluded from panels B and C.
The variation in COVID-19 prevalence over the course of 2020 is visible when tracking pollution over time. Figure 3 shows that average daily NO2 emissions in Western European cities dropped most from March to June of 2020, during the first wave of the pandemic. NO2 levels were comparable to the previous year in July and August when case numbers fell and restrictions were lifted. In the last months of the year, as the second wave hit, NO2 emissions once more dropped below the previous year’s average. This pattern is similar for Eastern European cities but the decline in NO2 in the first half of the year is less pronounced.
Figure 3
Source: Author’s calculations based on the World Air Quality Index COVID-19 dataset. Lines show the seven day moving average of the ratio between average NO2 emissions in 2020 and 2019.
Conclusion
The COVID-19 epidemic has highlighted the health costs of air pollution. The preliminary evidence suggests that long-term exposure to pollution increased COVID-19 mortality rates (Cole et al. 2020, Wu et al. 2020). This is a particular concern for countries across Eastern Europe which – at the time of writing – are still grappling with the second wave of the pandemic in Europe. Many people in this region have been exposed to polluted air for decades.
The pandemic has also demonstrated that air quality can improve relatively quickly when human behaviour changes. The data described in this brief suggest that Eastern Europe was no exception in this regard, although the declines were confined to some categories of pollutants. Achieving a more general, and sustained improvement in air quality will require a shift from coal power towards cleaner forms of energy.
Stimulus packages aimed at a post-pandemic economic recovery can provide an opportunity for policy to reorient the economy and accelerate such a shift. The consultancy Vivid Economics, which rated G20 member countries’ proposed stimulus packages in terms of their environmental impact, found that the ‘greenest’ stimulus proposals are those of the European Commission, France, UK, and Germany. Russia is one of the worst performers on this index (Vivid Economics 2020). Whether governments in Eastern Europe are able to take advantage of this opportunity will depend on their respective fiscal space and whether they make improving air quality a priority.
References
- Bagayev, Igor, and Julie Lochard, 2017. “EU air pollution regulation: A breath of fresh air for Eastern European polluting industries?.” Journal of Environmental Economics and Management 83: 145-163.
- Berman, Jesse D., and Keita Ebisu. 2020 “Changes in US air pollution during the COVID-19 pandemic.” Science of the Total Environment 739: 139864.
- BP 2020 “Statistical Review of World Energy – all data, 1965-2019“
- Bobak, Martin, and Richard GA Feachem. 1995. “Air pollution and mortality in central and eastern Europe: an estimate of the impact.” The European Journal of Public Health , no. 2: 82-86.
- Cole, Matthew, Ceren Ozgen, and Eric Strobl, 2020. “Air pollution exposure and COVID-19.”.
- Chen, Kai, Meng Wang, Conghong Huang, Patrick L. Kinney, and Paul T. Anastas, 2020. “Air pollution reduction and mortality benefit during the COVID-19 outbreak in China.” The Lancet Planetary Health 4, no. 6: e210-e212.
- European Environment Agency 2020. “Air Quality in Europe – 2020 report“, EEA Report No 9/2020
- Matkovic Puljic, V., D. Jones, C. Moore, L. Myllyvirta, R. Gierens, I. Kalaba, I. Ciuta, P. Gallop, and S. Risteska. 2019. “Chronic coal pollution–EU action on the Western Balkans will improve health and economies across Europe.” HEAL, CAN Europe, Sandbag, CEE Bankwatch Network and Europe Beyond Coal, Brussels.
- Ju, Min Jae, Jaehyun Oh, and Yoon-Hyeong Choi. 2020. “Changes in air pollution levels after COVID-19 outbreak in Korea.” Science of The Total Environment 750: 141521.
- Transport & Environment, 2018. “Briefing: Dirty diesels heading east”
- Vivid Economics, 2020. “Greenness of Stimulus Index” December 2020 update
- World Air Quality Index, 2021. “Worldwide COVID-19 dataset“
- World Health Organization, 2018. “WHO Global Ambient Air Quality Database (update May 2018)”
- Wu, Xiao, Rachel C. Nethery, Benjamin M. Sabath, Danielle Braun, and Francesca Dominici, 2020. “Exposure to air pollution and COVID-19 mortality in the United States.” medRxiv
Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.
The Impact of the COVID-19 Pandemic in Eastern Europe | Key Points From the 2020 SITE Development Day Conference
After having been relatively mildly affected in the first wave, Eastern Europe is currently in the midst of the second wave of the COVID-19 pandemic with much higher levels of infected and dead compared to the spring. This health crisis not only has economic consequences but also has contributed to political instability in parts of the region. This policy brief shortly summarizes the presentations and discussions held at the SITE Development Day 2020 Conference, focusing on the consequences of the COVID-19 pandemic in Eastern Europe.
A Swedish Government Perspective
The conference started with the Swedish Minister of International Development Cooperation, Peter Eriksson, discussing the current situation in Eastern Europe with a particular focus on the partnership with Sweden.
According to Minister Eriksson, Swedish foreign policy in general, and foreign aid policy in particular, has historically paid too little attention to Eastern Europe. He has therefore emphasized that Swedish aid should be used to promote democracy and human rights in the region. As the pandemic has exacerbated global anti-democratic trends and intensified existing inequalities, international support and cooperation have become more essential than ever.
Minister Eriksson mentioned several priority areas of Swedish aid policy in the region, such as the fight against corruption, economic reforms for poverty alleviation, gender equality, and media freedom. Emphasizing the importance of the latter, Minister Eriksson mentioned education for journalists and financial support for small independent media as important Swedish efforts in the region. He stressed that the protection of pluralistic media is also a military security matter, as countries like Georgia and Ukraine have been targets of foreign disinformation campaigns. The importance to support democracy and civil society was also illustrated by the case of Belarus, where all ongoing projects in partnership with the state or state-affiliated organizations have been suspended. The Swedish government has successfully implemented regional projects in energy efficiency and water purification, although Minister Eriksson underlined that the need for measures to slow down climate change is intensifying.
The important role of European Union membership was also mentioned. Minister Eriksson argued that the incentives created by potential EU membership have been the main drivers of democratization, modernization, and poverty reduction as well as progress towards greener economies in the region.
In response to the pandemic, Sweden, as well as the European Union, have increased aid transfers to Eastern Europe. Minister Eriksson underlined, though, the need to not only support immediately affected sectors and outcomes, as the pandemic has many serious spillover effects in other areas already in need of help prior to the crisis.
The Economic Outlook for the Region
The second section of the conference provided a current account of the economic situation in the region by two speakers from different sectors.
Alexander Plekhanov, director for Transition Impact and Global Economics at the European Bank for Reconstruction and Development (EBRD), shared results from an EBRD survey on the impact of the pandemic. The survey was conducted in August and covered 8 emerging economies in Eastern Europe and 6 more advanced countries for comparison.
Analysis of the survey responses shows that the impact of the crisis is very broad. The share of respondents that had lost their job was 15% in emerging economies, and almost twice as high in advanced economies. Many factors contributed to this gap. One affected area was tourism, with international tourism being particularly important in many emerging economies, and hard to replace with increased domestic tourism. The outbound relative to inbound tourism for countries like Sweden and the UK equals a factor of 3 and 2 respectively, while the corresponding in emerging economies is often below 1.
Compared to the 2008 financial crisis, the economic impact over the first five months of the pandemic was at similar aggregate levels, but more unequal across socio-economic groups. For instance, job losses were higher among the young and those with lower income and with less education. Yet, the overall impact in emerging economies was 10% less unequal than in advanced economies due to differences in the structures of economies and the feasibility of working from home.
Fredrik Rågmark, the CEO of Medicover, a healthcare and diagnostics services provider operating in the region in the last 25 years, provided insights from a business perspective.
Similar to Minister Eriksson, Rågmark argued that, for Medicover, the biggest change in the region over recent years has been related to EU integration, and in particular to Poland becoming an EU Member. Rågmark noted that the change was not limited to Poland: all the countries in the region are on a trajectory of change but at different stages. In his mind, the biggest difference between the emerging Eastern Europe and the West is that people have higher expectations about the future in the East.
Rågmark recognized that corruption has been a major challenge for the region in attracting business and investors, but also that it has gotten significantly better in recent years. The EU integration process has been essential there, as membership and continued support relies on institutional reforms to improve governance and ensure political accountability. Recognizing the risk that governments lose incentives to continue reforms once membership is secured (currently exemplified by the policies in Hungary and Poland), Rågmark yet emphasized that the European Union has been extremely successful in improving the business climate in the region and should receive more recognition than it often does.
As for the COVID-19 crisis, Rågmark argued that Plekanovs description was very representative of what he has seen in Eastern Europe. Medicover experienced a drastic falloff in late March when people were not allowed to visit the hospital unless they had acute symptoms. When countries re-opened in the summer, the company had a strong rebound of replaced demand from the lockdown. Also, Medicover has contributed significantly to the testing effort across the region. Due to the challenges associated with the skyrocketing demand for PCR testing, many countries in Eastern Europe that previously only allowed the public sector to treat inpatient COVID-19 cases, have opened up ambulatory services to the private sector. In terms of scaling up testing capacity, the private sector has been very important. Medicover is now a major provider of PCR-testing in Ukraine and Poland, and the single largest provider in Romania.
Economic Policy Responses to the Crisis: Regional Experiences
In this section, experts from the FREE network provided brief overviews of the current situation in their respective countries, as well as the major developments during the year.
Belarus
The Academic Director of BEROC, Kataryna Bornukova, provided an alarming description of recent developments in Belarus. Even before 2020, the prospects of the Belarussian economy did not look great. As relations with Russia started to worsen, the year began with shortages in the oil supply which contributed to GDP contraction already in the first quarter. When the pandemic hit Belarus in the spring the government neglected its severity. Initially, no measures of economic relief were introduced and there are valid suspicions that the official COVID-19 statistics were inaccurate. Eventually, the government created incentives for state-owned companies to keep up output, slowing down the GDP contraction in the second quarter. However, these measures are now a source of financial risk for the whole country as the state has accumulated huge inventories and substantially increased public debt. Unfortunately, during the second wave, policy responses are still lacking and the ongoing political crisis worsens the situation as it hampers economic development through increased uncertainty and lowered public trust.
Poland
As for Poland, Michal Myck, director of CenEA, argued that development during the crises has been mixed both in terms of the pandemic itself and government response.
While infections were at low levels during the first wave in April, they increased sharply during the second wave at the end of October. Similar to Belarus, there have been significant political developments over the year such as the presidential election campaign and the “Women’s Strike”. Myck suggested that these events have complicated a clear strategic response to the virus. During the summer, the government shifted its attention away from preparations for the second wave, towards the July elections. The first wave was met by fiscal and monetary stimulus packages. Although employment and growth have not fallen that much relative to neighboring countries, Myck argued that Poland will be left with a significantly higher level of public debt and other challenges when the pandemic is over.
Georgia
Giorgi Papava, Center Head at ISET-PI, explained that the Georgian government declared a state of emergency and lockdown in March, despite the low number of infections at the time. From April to June, the economy then experienced a 13% drop in GDP. After the economy re-opened at the end of June, it has shown a slight recovery over the summer. Unfortunately, it was followed by a sharp increase in infections in the autumn. This second wave was not met by similar restrictions until after the elections at the end of November, again suggesting the role of politics in the pandemic response in the region. In terms of economic impact, the most severe blow for Georgia was the sharp decline in tourism affecting many sectors including hospitality and food services, construction, arts, entertainment, and recreation.
Ukraine
Olena Sholomytska, Senior Researcher at KSE, explained how Ukraine, like most other countries in the region, experienced low reported infection rates in the spring, though high detection rates and low levels of testing may suggest that real infection rates were higher. The summer was followed by a sharp increase in infections and the situation has worsened since then. The economy saw a 7.5% drop in GDP in the second quarter, partly due to a strict lockdown policy, followed by a slight recovery in the third. The Ukrainian government has introduced various monetary and fiscal measures for both households and firms including cash allowances for self-employed, small firms, and people with temporary pay cuts, as well as long-term financing for banks up to 5 years. Currently, the government is reluctant to enforce stricter measures to prevent the second wave of infections mainly for political reasons. Ukrainians are becoming less afraid of the virus and more discontent with the restrictions, so the government is concerned about taking an unpopular decision.
Russia
Natalya Volchkova, Director at CEFIR at NES, explained how Russia, after a relatively calm summer, was hit by the second wave in October as the number of infections and COVID-19 deaths reached their highest levels since the onset of the pandemic. As far as economic performance is concerned, monthly indicators of economic activity show a sharp decline at the beginning of March and a slight recovery since then. However, when looking at month-on-month comparisons, economic performance is significantly lower in every month throughout 2020 compared to 2019.
The support measures introduced during the spring and summer constituted 3.7% of GDP. While most stimulus was allocated to the corporate sector (2.1%) households also received a significant amount of support (1.6%). The measures targeted to help household income included: cash transfers to families with children; increased unemployment benefits; 2019 tax-return for self-employed; extra payments to medical specialists; and credit restructuring and penalty-free payment deferrals for COVID-19 infected. The support dedicated to the business sector included: tax and credit payment deferrals; bankruptcy moratorium for 6 months; reduction in property tax: and subsidies to backbone enterprises. The support measures are expected to increase GDP growth by 1.8 percentage points by boosting household consumption, corporate inventory, and investments.
Latvia
Sergej Gubin, Research Fellow at BICEPS, described the epidemiological impact of the pandemic in the spring as hardly noticeable in Latvia. Although, the country currently has the 3rd lowest COVID-19 mortality rate in the EU, infections and mortality have increased quite dramatically during the fall.
While the restrictions introduced in the spring did not include a strict lockdown or a mandatory mask policy, the government closed borders, schools, and kindergartens. Following the second wave, the restrictions adjusted to including a mask policy, open borders, and 5-12 graders on distance learning.
The economic policy response has included downtime benefits for employees of firms with a reduction in turnover of 30% or more, temporary tax reliefs, and sick leave benefits for parents with young children on distance learning. The drop in GDP for 2020 is projected to be 7% and unemployment is expected to increase by 7.7%.
The Implications of the Pandemic for Gender Inequality
It is widely known that the pandemic has had catastrophic consequences for health and economic activity. Many experts, though, have also expressed concerns about its impact on gender equality and the welfare of women. On the health side, men and women have been shown to be equally susceptible to infection, however among those that get infected women have significantly lower mortality rates than men. Monika Oczkowska, Senior Researcher at CenEA, showed that about 40 % of deaths in Poland were women, which is very similar to Western European countries, whereas excess mortality has been particularly high among men in older age groups.
The pandemic has also impacted gender inequality through the labor market. In countries like Ukraine and Georgia, the pandemic has significantly worsened pre-existing inequalities. In the latter, the number of registered unemployed increased by 16 000 in the second quarter, and among them, 90% were women, according to Yaroslava Babych, Policy Center Head at ISET-PI. Also, among the 44 000 workers that lost their employment during lockdown in the spring a vast majority were women. Partly, the reason for this is that the restrictions affected sectors that were predominantly female such as restaurants, cafés, and retail, as well as arts and entertainment.
In Belarus, a country with relatively high female labor force participation, the impact on gender inequality changed over time. In the Belarussian labor market, women are highly concentrated in the hospitality and public sector, and men in the industrial sector. After the first wave in the spring, women were worst affected, both in terms of unemployment and loss of income, which was largely driven by the impact on the hospitality industry. Over time men became more affected as the industrial sector took a hit, whereas women benefitted from steady employment within the public sector. The gender distribution in the Ukrainian labor market is similar to the Belarusian. Women are concentrated in sectors that are economically vulnerable to the crisis but also in those that are critical for everyday life such as the health and education sectors. In other words, in these countries some women are at high risk of losing their job while others, that are less at risk of an economic shock, often are particularly likely to be exposed to health shocks.
From a more positive perspective, the crisis has also brought about structural changes to the labor market that could potentially improve gender equality. In Russia, workplaces have started to provide more flexible working conditions which have enabled more women to work remotely from home.
One serious consequence of the crises is an increase in domestic violence as the pandemic has exacerbated things that are known to increase conflict and violence within households. Maria Perrotta Berlin, Assistant professor at SITE, argued that mobility restrictions have increased the time spent with family members, increased isolation from social networks and support organizations, and increased stress caused by economic insecurity. According to the international ombudsman of Russia, the number of distress calls relating to intimate partner violence has increased by 150% during the pandemic, compared to an estimated average increase of 60% in Europe during the same time.
Political Implications in the Region with a Special Focus on Belarus and Russia
The final section of the day focused on political developments in Russia and Belarus in the times of the COVID-19 pandemic, two countries with close historical, political and economic ties. SITE invited two experts on the politics in respective countries: Elena Panfilova, Founder of the Center for Anti-corruption Research and former Chair of Initiative Transparency International – Russia, and Artyom Shraibman, founder of Sense Analytics, a political consultancy in Minsk and nonresident scholar at the Carnegie Moscow Center.
Panfilova gave a comprehensive narrative of the recent political developments in Russia related to the onset of the pandemic. Panfilova argued that the political response to the pandemic in Russia changed over time. In the spring, the government and political elites had a relatively active response and clear communication with the public. However, when the second wave started in September the government largely stayed silent. According to Panfilova, the reason for this is that Russian politicians started to anticipate the important 2021 regional elections and that they found it hard to communicate with the public without challenging their future political interests as the crisis response had been met with much discontent. This discontent, Panfilova argued, had to do with Russia’s vertical system of accountability being very ineffective in dealing with a horizontal problem such as COVID-19. The response system would have needed help across the political spectrum and would have benefited from more transparency to fight the pandemic; instead, the government continued to restrict political freedom and civil rights.
Reacting to the introduction by Panfilova, Shraibman argued that there is no historic example of a situation where the response to similar situations have differed so much between the Belarusian and Russian governments. The Belarusian regime’s response, in contrast to the Russian, was close to non-existent in the first wave and this continued up until the autumn when the government started to introduce restrictions in response to the second wave of infections.
The pressure of the pandemic has revealed the weaknesses and flaws of governments around the world and not least in Belarus. Although there are several reasons for the political crisis such as the stagnation of the Belarus economy, Shraibman argued that the mismanagement of the pandemic became the tipping point.
Shraibman explained how the Belarus regime has always tried to sell a paternalistic identity and has presented itself as a stable and fair welfare system that cares for the poor and the vulnerable. The mishandling of the COVID-19 pandemic shattered this identity in the eyes of the public. The rhetoric and state-level deception during the first wave irritated a lot of people as the state-owned media outlets often accused the sick of being weak and ridiculed people for wearing masks. As many Belarusians saw relatives die and doctors started to contradict the narrative of the state, people were reminded of the Soviet government’s concealment of the Chernobyl disaster.
These developments created stress on the Belarusian society right before the presidential elections in August since the frustration that had been accumulated was channeled into political activity. During the pandemic, people learned how to organize and coordinate crowdfunding initiatives to support doctors and similar initiatives. This self-organization infrastructure transferred to the opposition campaign and is now used to support victims of political repression.
During the second wave, the government started exploiting the crisis to restrict political freedom. For instance, independent observers were not allowed to observe electoral polls, and political prisoners were not allowed to meet with lawyers. These and similar actions have further aggravated the political discontent with the regime in the country. Shraibman concluded that groups in society that previously have been apolitical now have become politicized, as they have personally experienced the repressive measures previously targeted primarily to the Belarusian opposition.
Concluding Remarks
As in previous years, the Development Day conference offered us an opportunity to invite a diverse group of experts, politicians, and practitioners to discuss a current and important topic in the area of development and transition. The different perspectives highlighted the multifaceted impact of the COVID-19 pandemic on Eastern Europe, as well as the continued engagement of Swedish society in the region. Unfortunately, the pandemic also prevented us from meeting in person this time, but we hope that next year we will be able to meet again at the Stockholm School of Economics.
List of Participants
- Peter Eriksson, Minister for International Development Cooperation, Sweden.
- Alexander Plekhanov, director for Transition Impact and Global Economics, EBRD.
- Fredrik Rågmark, CEO Medicover, Sweden.
- Kataryna Bornukova, Academic Director BEROC, Minsk, Belarus.
- Michal Myck, Director CenEA, Szczecin Poland.
- Giorgi Papava, Center Head at ISET-PI, Tbilisi, Georgia.
- Olena Sholomytska, Senior Researcher KSE, Kyiv, Ukraine.
- Natalya Volchkova, Director CEFOR at NES, Moscow, Russia.
- Sergej Gubin, Research Fellow BICEPS, Riga, Latvia.
- Lev Lvovskiy, Research Fellow BEROC, Minsk, Belarus.
- Monika Oczkowska, Senior Research Economist CenEA, Szczecin, Poland.
- Yaroslava Babych, Head of Macroeconomic Policy Research Center ISET-PI, Tbilisi, Georgia.
- Aleksandr Grigoryan, Associate Professor American University of Armenia, Yerevan, Armenia.
- Olga Kupets, Policy Professor KSE, Kyiv, Ukraine.
- Maria Perrotta Berlin, Assistant Professor SITE, Stockholm, Sweden.
- Artyom Shraibman, founder of Sense Analytics and nonresident scholar at the Carnegie Moscow Center.
- Elena Panfilova, Founder of the Center for Anti-corruption Research and former Chair of Initiative Transparency International – Russia.
Disclaimer: Opinions expressed in policy briefs and other publications are those of the authors; they do not necessarily reflect those of the FREE Network and its research institutes.