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8THE ASSESSMENT OF LIFE QUALITY AS THE PREREQUISITE OF THE GLOBAL ECONOMIC
DEVELOPMENT
Herman L. T.
Ukraine, Ternopil Ternopil National Economic University
Abstract. The role of social factors in the global economic development is grounded in this article. The technical assessment of the realization of the Millennium Development Goals (MDGs) was conducted and the de facto achievement of the certain goals of the MDGs is elucidated. The ensuring of high life quality on a worldwide scale is among the up-to-2030 goals of the highest priority, especially taking into consideration the fact that the social progress is asymmetric in the world dimensions. In the modern economic and social sciences, the definition of life quality is regarded as equal to well-being. The determinants of the increase of life quality are humanization and environmental awareness within the context of the global economic development. The upshot is that technological progress has ousted a human being from the frame of social well-being, while the GDP per capita has lost its status as the only indication of well-being measurement. The cause-effect connection between economic development, economic growth and individual well-being melioration is proven have a contradictory feature, judging from the approaches and opinions of various researchers. Peculiarly, the American socialist and futurologist E. Toffler strenuously argued that the most tremendous threats to the development of humankind are psychological factors rather than economic and ecological ones. By roasting the postindustrial society alive, H. Marcus points out to the unfavorable effects the informational society has on a human and their development, for a matured society of mass consumption has determined its own values, which distort individual needs and desires. Life quality is an integral showing, which encompasses economic, material, cultural, political, ecological and other constituents. The assessment of life quality is conducted within the context of the following indicators: (1) the human development index, (2) the quality-of-life index and (3) the social progress index. In conclusions, the fact that the global economic development is attainable under the conditions of the ensuring of individual well-being and appropriate life quality is emphasized.
Keywords: the global economic development, well-being, economic growth, the human development index, the postindustrial society, social progress, life quality.
The importance of a social constituent in the global economic development and the necessity of life quality melioration have been among the concerns of the highest priority for the last several decades, judging by the fact that a number of international institutions' projects has been already dedicated to both the ensuring of social protection and the maintenance of social policies on a worldwide scale. Nowadays, the programmes of comprehensive development put special emphasis on the necessity of following the principle of indissolubility between economic and social constituents while strategizing at national and international levels. The already declared eight Millennium Development Goals have proven be an efficient set of tools and directions needed to be adopted in the process of the elaboration of social and economic projects and policies, especially for developing and poorly developed countries. The fact is that the worldwide mobilization of effects has significantly encouraged life quality around the world. For instance, for the last 25 years, the fraction of the population of developing countries, which lives below the poverty threshold, has shrunk from 47% to 14%. In the world dimensions, the number of people struggling below the poverty threshold has decreased as twice as many. Additionally, the number of children missing schooling through financial hardship has dropped half the height, while mother and child mortality of infectious diseases noticeably edged down. As a matter of a fact, 147 countries around the world have provided population with fresh water access, in the meantime 95 countries have arranged the provision of sanitary means. The development goals assistance provided by developed countries has soared up by 66% for the last 15 years. Access to the markets of developed countries has been liberalized for goods originated from developing countries. The number of mobile connection users has skyrocketed ten times. Internet users have increased its ranks from 6% to 43% [1]. However, the status quo of social progress on a worldwide scale has still been asymmetric. On these grounds, the new up-to-2030 development goals have been set, the achievement of which is expected to result in both the
conspicuous levelling of economic and social development and paving the way for global changes as a prerequisite for life quality improvement [2].
Importantly, life quality is the component of vital importance for non-asymmetric global development. Undoubtedly, this inherent component of comprehensive development is the reflection of a human being's ability to implement their values. It is well worth mentioning that the determinants of life quality melioration are humanization and ecological awareness within the context of global economic development. Evidence for the fact that life quality equals to well-being is borne out by a great deal of research. A. Pigou puts forward the view that the phenomenon of well-being should be taken for granted as the aggregate of goods and services a human being needs to live on and lead a comfort life, which is outlines individual well-being [3]. Besides, individual well-being forms under the influence of economic well-being and some external factors (for instance, the state of environment). However, being the essentials of well-being, income levelling is unattainable without the intervention of government.
As a matter of a fact, the world development paradigm of the last decade placed emphasis on economic aspect of the development of humankind and this made economic growth and economic development seem to be equal. Indisputably, in XX century, countries around the world demonstrated considerable economic growth rates, which were accompanied by the extension of production facilities, agile investment activity, increasing trade volumes, increasing household income and all those economic phenomena turned out to be the key factors of significantly improved well-being and life quality. However, as it was proven in practice, the intensification of both international economic relations and technological and scientific advance impacted a human being in rather an unfavorable way so that a comprehensively endowed individual, which is the only mission of any economic activities, found themselves beyond the frame of social well-being, meanwhile the GDP per capita stopped being recognized as the only indication of development. American sociologist and futurologist E. Toffler, a co-founder of the postindustrial society concept, lends support to the claim that the society grounding on information should enrich and replenish itself with new knowledge, strive for high skilled human capital and be featured with modern approaches to the educational system. In parallel, the research assures that the-first-to-deal-with challenges on the way of the development of humankind are those of psychological domain rather than economic and ecological ones. The reason why societies having craving for post industrialization need survival strategies is the fact that the aspects of their development such as wages, account balance and productivity become susceptible to changes in non-economic environment. Furthermore, racism, keen rivalry throughout generations, villainy and cultural autonomy can all be economically measured, but none of them should be researched by means of and within strict frameworks of economic approaches [4, p. 492]. Fortunately, post industrial society is highly likely to be subjected to worsening of social conflicts.
At the same time, it is plausible to disagree with the views of researchers, which rest on the assumption that economic development always has unfavorable trend causing both the distortion and belittlement of the social aspects of comprehensive development and apprehension about the individual's material needs prevailing spiritual ones. By assaulting the post industrial society, the representative of Frankfurt economic school, Herbert Markus, suggested that such type of society has deleterious effect on a human and their development, for a formal society of mass consumption has outlined its values, which it turn distorted needs and desires of an individual. On this logic, liberty and rights, including free entrepreneurship, share the fate of the society they constitute of. However, sacrifices and losses humankind has succumbed to on account of the implementation of living standards of developed countries cannot be justified, since the society of well-being give birth to the negative tendencies of human development [5].
Controversy in approaches to understanding of wellbeing, its parameters and needs insalutarily influenced on the absence of a well-established interpretation of the essences of life quality and ways of life quality assessment. Overall, researches reach the common background on how life quality should be defined and measured from the perspective of the human development concepts. Thus, it is worthwhile to agree with the views of Ukrainian researches on the assumption that a human is the mission of economic growth, but not resource thereof (it fully observes the principles of the United Nations) [6, p. 7].
Life quality is an integral indicator, which represents economic, material, cultural, political and economic constituents of comprehensive development, hence ability not only to endow basic material needs of an individual, but pave the way for personal development. The basic criteria of the assessment of life quality are GDP per capita, household income, demographic parameters, social, cultural and educational showings. Some researchers solely prioritize social indicators [7].
Currently, the index approach allowing for analytic groups to form country ratings is known as the most appropriate way of assessing life quality. Among a handful of indexes, the most useful and instrumental are human development index (HDI) [8], which encompasses the ways of improving
human potential and preconditions for its development (education, health care, well-being). In 2014, the top five countries by the HDI are Norway, Switzerland, Denmark and Netherlands.
In 2011, Organization for Economic Co-operation and Development (OECD) released the report "How's Life?", where apart from GDP, special emphasis was put on education, healthcare, environment, personal safety, political institutions etc. within the time frameworks from 1820 to the date [9]. Embracing 25 countries and 8 regions, the report introduced a deep research based on 10 parameters, which reflects well-being of a country. The 2015 rating provided evidence supporting the claim that the improvement of life quality does not rely on economic aspects only. De facto, the countries of OECD succeeded in an attempt to achieve positive tendencies of economic growth, but the issues regarding unemployment, expensive real estate, unequal preconditions for development (including those preconditions for children). As a matter of a fact, every seventh child in the countries of OECD lives within the frames of poverty and roughly 10% of children live in families, where parents are unemployed [10].
Another indicator reflecting standard of living is social progress index, which embraces over 50 indicators representing the level of basic needs satisfaction, well-being and potential for development and prosperity [11]. In 2015, the rating enclosed 13 countries, where Norway, Sweden, Switzerland, Island and New Zealand are on top. Alternatively, there are the Happy Planet Index and the Legatum Prosperity Index which are also taken into account while assessing life quality and comprehensive development.
Therefore, the global economic development within the qualitative and quantitative context is attainable should individual well-being and appropriate standard of life be ensured. Moreover, relevant living standard is inherently featured as non-fragmental in the global dimensions. In addition, the ensuing of high living standards and efficient individual development unquestionably depends on both the reconsideration of the set of established standards elaborated by developed countries without taking into account the needs of developing countries and on moving from the economic essentials of the global development ideology to social and ecological ones. Life quality is an orienteer, which is a jump-off platform for defining both whether the economy of a country is socially directed and whether social priorities are incorporated into an economic development strategy.
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