Puukallistajad ajavad käojaani

Selge on see, et Eesti Vabariigi idee ei ole raha teenida, vaid eesti kultuuri ja rahvast
säilitada. Iseenesest ei ole need kaks nähtust vastuolus: uuringute tulemused kinnitavad, et rohkema raha eest saab rohkem tervist, haridust, õnne ja sotsiaalset heaolu, mitte vähem. Kuid Eestis näib olevat levinud mõtteviis, et selleks et kultuuri ja rahvast edendada, on vaja majanduskasvu pidurdada. Mõnede meelest oleks Eestil vaja suurendada naturaalmajanduse ja bartertehingute osakaalu, sest ‘ressursse ei jätku’. Ideaaliks peetakse olukorda, kus inimesed kasvatavad ise toidu, teevad riided ja mööbli ja kaevavad maa seest autosse valamiseks ka naftat. Vastupidiselt mõne aasta eest majanduskrahhis kogetule, kui Eesti majanduskasv vähenes aastaga 17 protsenti, mille kestel rahvas jäi (ülla-ülla) vaesemaks, arvatakse mõnedes puukallistamise kogukondades ikka, et kahenev majandus kasvataks Eesti heaolu. Kuidas?

Paljude meelest saab rahvas väärikalt elada vaid toimivas kvaliteetses kultuurses keskkonnas, mitte rahakeskses süsteemis, milles ei nähta lahendit ei vaesusele ega õnnele ega rikkusele. Väidetakse, et inimkond on maakera ressurssidega viimase 150 aastaga üsna puhta vuugi teinud, ning viidatakse Rooma Klubi 1970ndatel välja antud raamatule Kasvu Piirangud. Selle vana raamat väidab, et maakera ressursid ei saa toetada sellist majanduse ja inimkonna kasvu isegi mitte arenenud tehnoloogiaga. See hüsteeria kasvava majanduse vastu peegeldab 18. sajandi usumehe Malthuse hirmu, et rahva lisandudes ei jätku kõigile enam toitu, ignoreerides fakte selle kohta, et pärast 2. maailmasõda on toiduainete tootmine on kasvanud kiiremini kui rahvastiku juurdekasv.

Selle volatiilsus väheneb ja levik on kõikjal paranenud. Toidu tegelikku puudust ei saa süüdistada ka näljahädades, mis on tekkinud poliitilistel mitte põllumajanduslikel põhjustel.

Eesti vaesumise pooldajad aimavad õigesti, et sisemajanduse kogutoodang (SKT) ei ole hea mõõdik rahva heaolu mõõtmiseks. Viimasel ajal ongi õnneks tekkinud mitmeid alternatiivseid indekseid, mis mõõdavad kas rahva sotsiaalselt heaolu (tervist, haridust, vabadusi, looduskeskkonda, elamistingimusi, mida saab raha eest osta) või siis seda, kui jätkusuutlik riigi majandus on, mõõtes riikide varasid, mille pealt raha teha ja SKTd kasvatada.

Just see viimane – riigi varade – mõõtmine, mille kallal töötasid Maailmapanga teadlased Glenn-Marie Lange, Quentin Wodon ja Kevin Carey mitu aastat, aitab meil aru saada, kui suurt rolli tegelikult mängib ressursside “röövimine” majanduses. Tänavu veebruari alguses esitletud raport ‘Riikide muutuv rikkus’ vaatab riikide varasid kolme ressursi kaudu, mõõtes esiteks maavarade hulka, teiseks inimkätega loodud rikkust (ehk taristut) ning kolmandaks inimressurssi. Paljude meelest oleks võinud arvestusse neljandaks kaasata ka riikide institutsioonid, millest oleneb, kui võrselt on võimalused ning rahaline ja sotsiaalne heaolu inimeste vahel jagatud.

Täpselt nagu firmadel on oma väärtuse hindamiseks kasumiaruanne ja bilanss, nii peavad ka riigid vaatama, kas edasiseks majanduskasvuks on olemas vajaminev laiaulatuslik varade portfell. Ja kuigi 70ndatel aastatel tehtud hoiatuste põhjal oleks võinud arvata, et kõik ressursid saavad kohe otsa, leidis uuring sellegipoolest, et maailma varade portfell (mitte segi ajada sisemajanduse kogutoodanguga) kasvas ajavahemikus 1995-2014 märkimisväärselt.

Uuring, mis mõõtis 141 riigi varasid 20 aasta jooksul (1995 -2014), leidis, et riigid saavad vara luua investeeringute tegemisega kahte esimesse ressurssi – taristusse ja inimeste haridusse – ning samal ajal kolmandat ressurssi - maavarasid – mõistlikult majandades. Kõrge sissetulekuga riikides, mille hulka kuulub ka Eesti, moodustab inimkapital (mida teadurid mõõtsid inimese eluea jooksul teenitud tulu väärtusena) 70 protsenti kogu varadest. Rikkad ja nutikad riigid kasutavad ka palju rohkem taastuvaid ressursse, mis ei ammendu. Ainult vaesed riigid toetuvad oma majanduses enamasti loodusressursside kasutamisele. Muuseas, kaks kolmandikku nendest riikidest, mis on jäänud 20 aasta jooksul vaesemaks, on maavarade poolest rikkad. Kuid enamus on neist ka haprad või sõjalises konfliktis olevad riigid, mis näitab veel kord, et loodusvarad üksinda ei kindlusta riigi arengut. Uuring näitab ka, et varade loomine ei käi maavarade röövimise kaudu, vaid rikkus saavutatakse palju efektiivsema maavarade kasutamisega, millest saadud tulu investeeritakse tagasi haridusse ja taristusse. Järelikult pole vaja ka maavaradele lõppemisele liialt keskenduda. Majanduse jätkusuutlikkuseks on vaja hoopis häid institutsioone, mis majandaks maavarasid mõistlikult. Ja head institutsioonid on enamasi hea haridusega riikides. 

Kõige tähtsam tõdemus ongi see, et inimkapital (ehk siis haritud ja terved inimesed) on maailma kõige tähtsam vara. Hea uudis on see, et haridust ja tervist saab osta raha eest. Kuidas naturaalmajanduse ja bartertehingute tingimustes raha teenida, mille eest siis haridust, kultuuri ja tervist osta, majanduskasvu needvad maamehed meile ei ütle.  Nad ajavad meile ainult käojaani väärikusest ja väärtussüsteemidest.

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Eesti on sotsiaalses edukuses maailma esi-kahekümnes

Kui ma jaanuari lõpus Aripäevas kirjutasin, et peaksime Eesti edukamaks muutmiseks kasutama nutikat müksamis-tehnikat, jättis keegi Kalmer kommentaaridesse pessimistliku tarkuse: “Eestil pole lootustki edukaks saada.”

Mõni kuu hiljem näeme, et Eesti on 132 riigi hulgas sotsiaalse edukuse poolest maailmas 19. kohal, edestades isegi Prantsusmaad. Esikolmikus on Uus-Meremaa, Sveitsh ja Island. Eesti naabritest on edukaim Soome (8. koht) : Läti 31., ning Venemaa alles 80. kohal.

USA mittetulundusühingu Social Progress Imperative poolt loodud sotsiaalse edukuse indeks püüab sisemajanduskogutoodangu (SKP) kui riikide põhilise võrdlusaluse näitaja kõrvale lükata. Kuigi majanduskasv on paljudes riikides edukalt vaesust vähendanud, ei tähenda riigi rikkus automaatselt seda, et inimeste elu hea oleks. Näiteks on USA Eestist SKP osas ühe inimese kohta kolm korda rikkam, aga edestab Eestit sotsiaalse edukuse osas vaid pooleteise punkti võrra, olles pingereas alles 16. kohal. Selle rikkuse juures oleks oodanud hulga suuremat sotsiaalset kindlustatust – kohta vähemalt esikümnes. Ka Prantsusmaa, Itaalia, Hispaania, Portugali ning Hispaania on Eestist  SKP osas ühe inimese kohta hulga rikkamad, kuid sotsiaalse edukuse osas jäävad Eestile alla.  Eesti 19. koht sotsiaalse edukuse pingereas näitab, et Eesti on oivik – suutnud vähema rahaga oma inimeste jaoks rohkem saavutada. 

Ei SKP ega inimarenguindeks sobi inimeste elukvaliteedi ja heaolu mõõtmiseks, ning just seda vaakumit täima SEI loodigi. Initsiaatoriks, kusjuures, Harvardi ülikooli äri-guru ning omaaegse konkurentsivõime indeksi looja Michael E Porter ning tõukeks tema veendumus, et sotsiaalset edukust on vaja majanduse edasiseks kasvuks.

Mida täpselt siis SEI mõõdab? Indeks koosneb kolmest suurest sambast, mis mõõdavad inimeste põhivajadusi, heaolu aluseid ning võimalusi oma heaolu edendada. Kõik osapooled koosnevad omakorda mitmetest näitajatest, ja sugugi mitte iga näitaja ei anna põhjust uhkustada.

Põhivajaduste sammas mõõdab näiteks inimeste toidulaua ja eluaseme kvaliteeti, arstiabi kättesaadavust, puhta joogivee olemasolu ning isiklikku ohutust. Ja kuigi võib tunduda, et need on nii elementaarsed vajadused, millest 21. sajandi Euroopas rääkidagi kummaline, skoorib Eesti just selles sambas kolme hulgas tegelikult kõige kehvemalt. Eesti tuleb 132 riigi hulgas üldkokkuvõttes 28. kohale. Ilmselt veab Eesti taseme alla suhteliselt kehvad eluasemed – selle näitaja osas on Eesti alles 41. kohal maailmas. Kuid väga kiidelda ei saa ka turvalisuse (29. koht) ning vee ja hügieeni osas (38. koht).

Kui põhivajaduste osas peaks Eesti veel hulga tööd tegema, siis teises sambas, mis mõõdab heaolu aluseid, tuleb Eesti maailma arvestuses 10. kohale. Ilmselgelt on Eesti üleüldiselt hea tabeliseisu põhjus just see sammas, mis mõõdab juurdepääsu põhiteadmistele,  info- ja kommunikatsioonitehnoloogiatele, tervist ja ökosüsteemide kestlikkust. Ilmselt skooriks Eesti heaolu aluste sambas veelgi kõrgemalt, kui meie tervis oleks parem. 132 riigi hulgas on Eesti tervise osas alles 45. kohal, jäädes alla mitmele hulga vaesematele riikidele: näiteks Tuneesia, Paraguay, Bolivia, Albania ning isegi Niger ning Nicaragua ja Bangladesh.

Kolmanda samba puhul, mis mõõdab tulevikuvõimalusi, on Eestil ehk taas põhjust suhteliselt rahulolev olla. Kokkuvõttes tuleb Eesti 22. kohale. Tõrvatilgaks on selle samba puhul Eesti vähene tolerants ja teiste ühiskonnagruppide kehv kaasamine (60. koht). Seegi on ala, mille edendamiseks ei pea rahakott puuga selgas olema arvestades, et mõned Aafrika riigid nagu näiteks Libeeria, Namiibia, Svaasimaa on Eestist eespool.

Kuna Eesti on koos Sloveeniaga ainukesed endised sotsleeri-riigid tippkahekümnes, on Eestist avanev sotsiaalse edukuse pilt parile tõrvatilgale vaatamata siiski väga positiivne. Kuid lisaks eestlaste uhkustunde paisutamisele viitab indeks otseselt ka aladele, mille kallal saaks valitsused ja ühiskonnaliidrid heaolu kiiremaks edendamiseks edasi töötada. Eesti puhul siis tervis, tolerantsus, eluasemed. Vähemalt tolerantsust ja kaasavust saaks Eesti edendada ka majandusseisaku tingimustes.

To liberalize or not?

To liberalize or not, this is the central question in debates about the economies of developing countries. As the three Baltic countries and Estonia in particular have been considered[1],[2] as most successful former Soviet Union country out of 15 member states[3], in my paper I will explore which events had led to macroeconomic success. I will also evaluate the downsides of current macroeconomic situation, which carry a significant social cost. To a degree, my paper would be immersed in the debate whether (neo)liberal policies contribute to economic growth of developing countries.

What causes macroeconomic growth?

Estonia, a small country on the Baltic Sea shore[4] owes its macroeconomic growth to many eco-political decisions. But other, perhaps equally contributing factors are peaceful separation from Soviet Union (SU), geographical proximity to Nordic countries[5] and relative strength of institutions, together with the readiness to reform, which was further catalyzed by a desire to join European Union.

As Thorvaldur & Eduard (2009) assert, a conflict-free breakup from the SU gave Estonia an advantage over some other former SU (fSU) member states like Moldova, which enjoyed a similar economic level during the Soviet period. Lack of conflict allowed Estonia to avoid low-income trap, which both Moldova and Georgia fell into. As a result, Estonia did not suffer from high levels of corruption[6] and was able to reform its institutions. Compared to other fSU countries, its institutions were more effective in fighting shadow economy. The relatively small black market share contributed to an enlarged tax base and consequently to higher income, as Gylfason & Hochreiter suggest (Gylfason & Hochreiter, 2009).

Estonia, together with other Baltic countries benefitted from their proximity to Nordic countries, as Gylfason & Hochreiter claim: “when foreign markets collapsed in the early 1990s, Estonia was able to win new markets for its exports remarkably quickly in Western Europe” (ibid). Attractive opportunity to become an EU member country acted as a catalyzing tool for speeding up institution building and as a result, the recovery after the collapse of the Soviet Union economy was relatively fast. This was interrupted only by a “short-lived slowdown in 1999-2000 due to the Russian crisis” (Deroose, Flores, Giudice, & Turrini, 2010).

Another contributing factor to macroeconomic growth stemmed from the exclusion of the former Soviet political elite from power, as they were not unified as a political party. As a result, due to the elimination of the former elite from decision making, Adam, Kristan, & Tomšič note that “ideological standing of new Estonian political elite of early 1990ies played an important role in determining the type of capitalism pursued”. Unlike most of Eastern European countries, where former communists held on to the power, Estonia established (neo)liberal macroeconomic policies (Adam, Kristan, & Tomšič, 2009) – diametrically opposite from the Soviet centrally planned economy. Estonia established a flat income tax[7], opened up its economy, abolished tariffs for imports and kept a balanced budget or a very small deficit. The so-called Chang’s ladder – protectionist measures for promoting infant industry growth (Chang, 2003) was never used. These macroeconomic measures allowed massive foreign direct investment to flow into the country.

How to measure economic development?

There are many indices to measuring the levels of living standard. Income levels, GDP and the Human Development Index (HDI) are most widely used. Estonian average income, which started declining in 1990 (an average Estonian then earned 10,300 dollars annually in PPP dollars), by 1994 had fallen to the 1970 level – 7734 dollars! Poverty increased and the life expectancy shortened drastically during first couple years of re-independence.

The negative income trend was eventually reversed in 1994 and income consequently doubled during the next 10 years, while Estonia pursued (neo)liberal policies. As authors from European Commission, Directorate-General for Economic and Financial Affairs claim, the reform process was highly successful in reorienting the Baltic economies towards a market system, and thus helping these countries become eligible for EU accession in 2004 (Deroose, Flores, Giudice, & Turrini, 2010).

Estonia enjoyed unusually high growth in the mid-2000s – even by the standards of emerging economies (ibid.) – during which period the structure of the economy was changed. Previously a mainly agricultural country with Soviet-style heavy industry was turned into a subcontracting nation for services and IT[8], with a strong tourism sector. It was during the boom of early 2000s when Estonia was called to be one of the Baltic Tigers, distinguishing itself from other Eastern European and fSU countries[9].

In 2007, a year before the global financial meltdown, Estonians earned on average 19.705 PPP dollars[10] which is significant enhancement when compared to the early years of re-independence. By 2010, the income levels have reached parity with formerly communist Central European countries like Hungary and Poland, which used to be considerably better off. Considering the speed of catch-up in income levels, this fast progress indeed shows that liberal economic policies can, in some cases, contribute to the economic growth.

Earlier I measured the rise in living standards loosely through income rise in PPP dollars[11]. Now, I would like to amend the picture by adding HDI and other measurements to picture. Although considered to be an alternative to the money-centric measurement of well-being[12], HDI nevertheless includes economic measures in its formula. HDI does not seem to be satisfactory in portraying the price the people had paid for the economic growth. During the boom years, it was clear that the generated wealth was not distributed equally within the country, giving social scientists a reason to identify “Two Estonias” – one poor, the other better off.  For example, the most recent analysis composed by the Ombudsman of Estonia (Chancellor of Justice, 2011) shows that almost every fifth child in Estonia in 2010 lived in poverty due to inequality.

The ratio of total income[13] received by the top quintile to that received by the lowest quintile of the population is 5.0. Although this ratio does not differ from the European Union average, which is similarly 5.0 (Statistics of Estonia), the inequality has indeed risen since the 1989. Largely, in accordance with Kuznets’s reversed U, according to which economic growth first raises the inequality and later it levels out (Cypher & Dietz, 2004), the Estonian inequality graph seems similar to an inversed W.

Gapminder visualisation tool for the health and wealth of countries makes the picture of economic development even more complicated. For example, in highly unequal and somewhat poorer Mexico people enjoy better health than Estonians. Does this mean that economic success has negatively influenced people’s health, regardless of increased life expectancy? Similarly, the OECD Better Life index, which visualises the quality of life as flowers, shows the lopsidedness of Estonian flower petals, where Life Satisfaction is significantly shorter than other petals such as  Education[14]. 

Would neoliberal policies also alleviate economic downturns?

Similarly to my earlier speculation[15] about a likely correlation between (neo)liberal economic policies at the presence of some other favourable conditions and increased income levels, I am curious about what helps countries in deep recession?  In the case of open economy, it has been argued that the government’s ability to control the destructive globalized economy is limited (Held & McGrew, 1993). And what to think of Nobel prize winning economist Joseph Stiglitz’s recent comments the media: that the austerity measures Europe is planning to introduce would be suicidal?

The truth is that an open economy has not only raised income and the quality of life, but it has consequently opened Estonia to severe global crises. An open economy has brought a very short boom and bust cycle and severe economic meltdowns, during which the GDP growth was negative (-14 per cent in 2009). The Estonian government nevertheless introduced severe austerity measures to control the situation in 2008. These processes resulted in lower salaries (approximately by nine percent) while personal debt of many people had increased[16]. Despite that shocking downturn, Estonia’s economic decline was not so sharp compared to the massive economic failure of neighbouring Latvia, which needed assistance from IMF[17]. Regardless of this comparison, Estonian unemployment rate in 2010 was nevertheless a staggering 16.8 per cent.

Two years after introducing austerity measures, The Economist magazine reported in July 2011: “Plunging unemployment, rocketing growth, soaring exports and a budget surplus: that is the story of Estonia as it bounces back from a precipitous economic collapse.” The point The Economist wanted to convey was that austerity measures and strictly balanced budget guarantee a fast recovery after a severe economic meltdown, as the competitiveness of the country increases and it is therefore again able to attract investments. The Estonia.eu website claims that in 2010, the annual GDP grew by 3.1 per cent compared to the previous year. According to the 2011 forecast of the Ministry of Finance, the economy will grow in 2011 and in 2012 by 4 per cent[18], which is likely the highest growth rate in Europe.

Conclusion

Even if in the strictly economic sense the liberal policies and shock therapies have increased the incomes and improved the health of Estonians, people are increasingly tired of the sudden boom and bust cycle. Strikes organised by Estonian teachers and nurses prove that. I agree with the OECD recommendation on its website: “… to reduce the vulnerability of the poor and help them adjust to make the most of new opportunities that are created … open markets require parallel investments in human capital (education, health and nutrition) and physical infrastructure, access to credit and technical assistance, as well as social safety nets and policies to promote stability” (OECD). Although Estonians are relatively well educated, the health and nutrition (especially those of children) and social safety nets would need additional investment.

Bibliography

Adam, F., Kristan, P., & Tomšič, M. (2009, March). Varieties of capitalism in Eastern Europe. Communist and Post-Communist Studies , 65-81.

Brixiova, Z., Vartia, L., & Wörgötter, A. (2010). Capital flows and the boom–bust cycle: The case of Estonia. Economic Systems , 34 (1), 55-72.

Cato Institute. (2006, May 18). Cato Institute. Retrieved February 14, 2012, from http://www.cato-at-liberty.org/mart-laar-friedman-prize-winner/

Chancellor of Justice. (2011, February 13). Vaesus ja sellega seotud probleemid lastega peredes. Retrieved February 15, 2011, from http://oiguskantsler.ee/sites/default/files/ulevaade_vaesus_ja_sellega_seotud_probleemid_lastega_peredes._ulevaade..pdf

Chang, H.-J. (2003). Kicking away the Ladder: Infant Industry Promotion in Historical Perspective. Oxford Development Studies , 31 (1), 21-32.

Cypher, J. M., & Dietz, J. L. (2004). Measuring Economic Growth and Development, Part 1, Chapter II. In J. M. Cypher, & J. L. Dietz, Process of Economic Development. London: Routledge.

Deroose, S., Flores, E., Giudice, G., & Turrini, A. (2010). The Tale of the Baltics: Experiences, Challenges Ahead and Main Lessons. ECFIN Economic Brief (10).

Evans, P. (2008). Is an Alternative Globalization Possible? Politics & Society , 36 (2), 271-305.

Fougner, T. (2008). Neoliberal Governance of States: The Role of Competitiveness Indexing and Country Benchmarking. Millennium , 37 (2), 303-326.

Gylfason, & Hochreiter. (2009). Growing apart? A tale of two republics: Estonia and Georgia. European Journal of Political Economy , 25 (3), 355-370.

Harvey, D. (1995). Globalization in Question. Rethinking Marxism , 8 (4).

Held, D., & McGrew, A. (1993). Globalization and the Liberal Democratic State. Government and Opposition , 28 (2), 261-288.

Hirst, P., & Thompson, G. (2002). The future of globalization. Cooperation and Conflict: Journal of the Nordic International Studies Association , 37(3), 274-265.

Kiely, R. (2008). Poverty's Fall/China's Rise: Global Convergence or New Forms of Uneven Development? Journal of Contemporary Asia , 38 (3), 353-372.

Mohan G. (2008). Making Neoliberal States of Development: The Ghanaian Diaspora and the Politics of Homelands. Environment and Planning D: Society and Space , 26 (3), 464 – 479.

OECD. (n.d.). Trade and development. Retrieved February 15, 2011, from Trade - separating fact from fiction: http://www.oecd.org/document/58/0,3746,en_2649_37431_43440634_1_1_1_37431,00.html

Rantanen, T. (2001). The old and the new, Communications technology and globalization in Russia. New Media & Society , 3 ((1)), 85-105.

Statistics of Estonia. (n.d.). Inequality of income distribution Income quintile share ratio. Retrieved February 15, 2012, from http://www.stat.ee/29998

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[1] (Gylfason & Hochreiter, 2009)

[2] (Adam, Kristan, & Tomšič, 2009)

[3] Today, 20 years after the break up of SU, Estonia is a member of EU, NATO and OECD but also entered euro-zone and is part of Schengen visa regime. These memberships make Estonia the most integrated country to European structures, among Northern European countries. Today, Estonia is more centrally located to Europe than it has ever been.

[4] Regarding the size of territory, Estonia with its 45,227 km2 can be compared to province Nova Scotia (53,338 km2) in Canada, although population wise Estonian population of 1,3 million compares better with Manitoba (1,2 M).

[5] Even during Soviet times, Western culture was nevertheless influencing Estonia. Finnish communication theorist Terhi Rantanen claims that globalization does take place in closed societies, too (Rantanen, 2001). Soviet audience found their way to non-Communist programs through individual use of videocassettes, she claims. This “outward Westernization” of Soviet Estonia was also experienced via Finnish tourists, Finnish TV and Radio Free Europe/ Radio Liberty and Voice of America. The documentary ‘Disco and Atomic War’ (Kilmi & Aarma, 2009) claims that due to Finnish TV coverage in Estonia, “the Soviet regime went head-to-head with Western pop culture and learned that no one really cared about Lenin or Marx. Instead, the Estonian public wanted to know who shot J.R. and what the latest disco moves are”.

[6] Estonia ranks 29th on Worldwide Corruption Perceptions ranking on 2011, compared to fSU and Eastern Europe countries Estonia is the least corrupt country.

[7] In 1994, Estonia became the first country in Europe to introduce a so-called “flat tax” (The Economist, 2005)

[8] Estonian engineers created the Skype, Estonian government established e-elections, e-government and computer readable ID-card, and set up a Tiger Leap school program of computerization.

[9] Its’ so called “tiger-partners” being geographically distant: in Asia (Asian tigers) and in Ireland (Celtic tiger).

[10] All income data is taken from Gapminder unless otherwise specified.

[11] (It must be mentioned that Estonia succeeded to adopt euro ‘due to prudent fiscal policy, abundant foreign exchange reserves, and capital buffers for the banking sector’ (Deroose, Flores, Giudice, & Turrini, 2010).

[12] Similarly to the GDP and income level, HDI has gone up as well during the transitional period, placing Estonia in the highly developed countries bracket.

[13] Understood as equalized disposable income (Statistics of Estonia)

[14] http://www.oecdbetterlifeindex.org/countries/estonia/

[15] Some academics studying globalization and development[15] would deny that there is a possibility that neoliberal policies could, in the presence of some other favourable conditions as mentioned earlier lead to economic growth[15]. As most Western authors study failure of Structural Adjustment Programs in African countries (and rarely examine countries of former Soviet block or so called Second World) they conclude correctly that (neo)liberal policies caused increase in poverty levels. But Estonian case recommends that in presence of other favourable events, there is an exemption to the rule.

[16] On the other hand, no large scale protests a ‘la Greece took place in Estonia.

[17] Latvia had to be assisted by the European Union, the IMF and other donors (Deroose, Flores, Giudice, & Turrini, 2010)

[18] http://estonia.eu/about-estonia/economy-a-it/a-dynamic-economy.html