Relationship between the Human Development Index and public social spending: European experience for Ukraine
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DOIhttp://dx.doi.org/10.21511/ppm.22(4).2024.03
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Article InfoVolume 22 2024, Issue #4, pp. 25-38
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This study focuses on the relationship between the Human Development Index (HDI) and public social expenditures, analyzing socio-economic models using the examples of selected European countries and Ukraine. The study used the values of the HDI, GDP, and indicators of public expenditures for social purposes, namely, healthcare, education, leisure, culture and religion, and social protection for the period from 2010 to 2021. The analysis targeted 13 European countries using data sets from Eurostat, the Office for National Statistics of the United Kingdom, the State Statistics Service of Ukraine, and the Ministry of Finance of Ukraine. The input time series were checked for lagged values using the STATISTICA software.
Empirical evidence suggests a relationship between HDI and public social spending. An increase in the share of public social expenditures in GDP leads to an increase in HDI and vice versa. European countries with a social-democratic model of development have the highest level of centralization of public expenditure in GDP (34.72%) and the highest HDI (0.930), while countries belonging to the Southern European model have the lowest share of socially oriented public expenditure (30.41%) and the lowest HDI (0.873). In addition, there is a time lag between the investment of public funds in healthcare, education, leisure, culture and religion, and social protection and their impact on HDI changes. Thus, ensuring a high level of HDI is achieved, among other things, through state financial support for the relevant components of the social sphere and social protection.
Acknowledgment
The study is funded by the EU NextGenerationEU through the Recovery and Resilience Plan for Slovakia under project No. 09I03-03-V01-00130.
- Keywords
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JEL Classification (Paper profile tab)Н50, I31, О15
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References35
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Tables2
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Figures5
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- Figure 1. The main components of the Human Development Index
- Figure 2. Dynamics of the share of public expenditures for social purposes and HDI with a breakdown of different socio-economic models
- Figure 3. Dynamics of the share of public social expenditures that form HDI (healthcare, education, spiritual and physical development, social protection) by socio-economic models
- Figure 4. Visualization of trends in the share of social expenditures in GDP and HDI
- Figure 5. Results of checking input time series for lagging values
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- Table 1. Characteristics of socio-economic development models of countries
- Table A1. Dynamics of the Human Development Index in European countries and Ukraine for the period 2010–2021
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