FROM THE EDITOR This issue consists of eight articles, a report from an international conference, two announcements, an obituary of Professor Laslie Kish, and acknowledgements of referees of volume 4. There are articles from Italy, Estonia, and Poland: 1. Health Care Expenditure in Poland in the 1990s (by A. Baran from Poland). The author describes the health expenditure in Poland in comparison with that of other countries, changes of its level and structure in the period of transition. The most characteristic change in health expenditure in Poland observed over the period of transition is a significant increase of private expenditure of which over 50% are expenses for medicines. Private health expenditure was derived from the budget household survey. The data presented in the article cover the period of 1991-1998 with the exception of the total public expenditure which extends up to 1999. 2. Modelling Economic Convergence: a GEE Approach (by G. Carmeci and D. Gregori from Italy). To test convergence in per- capita income levels across poor and rich countries, researchers usually estimate a cross-country linear model that assumes independence among per-capita income growth rates. Several issues lead the authors to think that this hypothesis is rather strong, and to identify the economic integration among countries as the primary source of spatial correlation. They estimate the model (using three different types of clusters to specify economic integration) for the same data as Mankiw, Romer & Weil (1992). They find that the parameterisation of the errors as uncorrelated is a simplification that the data do not support. Once the cluster effect is taken into account the model performs well, but a high variability in the estimates with respect to different correlation structures is observed. 3. Trend Forecasting in Qualitative Business Survey of the Polish Retail Trade (by A. Ciok from Poland). Problems concerning middle-term forecasting in business survey of the Polish retail trade STATISTICS IN TRANSITION, December 2000 are discussed. A new method of forecasting is proposed, which can recognise only general trends, not particular values of series. The method has been tested on a series of sales indices. 4. Estimation of Bulgarian Food Demand: a Multistage Approach (by S. Rigatti L., I. Procidano, M. C. Mason from Italy). The aim of this paper is to examine the impact of the market reform process, started in February 1991, upon food consumption patterns of the Bulgarian population. After eight years of reforms, the structural forms of the Bulgarian economy are still ambiguous. The authors have used a two-stage budgeting model to estimate the demand for fairly disaggregated food groups in Bulgaria. In this paper the authors intend to provide further evidence of the nature of structural change in food demand. The paper outlines the structural change in food consumption within a model satisfying acceptable definitions of flexibility and the restrictions of utility maximisation. 5. Polish Innovation Surveys – the Present Situation and the Analysis of Results (by G. Niedbalska from Poland). This paper analyses the results of the comprehensive surveys on innovation in industry carried out by the Central Statistical Office of Poland (GUS) in 1993 and in 1997. As distinct from the yearly concise surveys on innovation carried out by GUS, the periodic and comprehensive surveys cover a broad range of questions concerning different important aspects of innovation activities such as objectives of innovation, sources of information for innovation or obstacles to innovation. The 1997 survey based on the questionnaire used in the first phase of the Community Innovation Survey (CIS – the project which is the main source of information on the innovation activities in European enterprises) opened the opportunity to benchmark Polish industrial enterprises’ innovation effort against the West-European countries activities. 6. Economic Transition, Poverty and Inequality: Poland in the 1990s (by A. Szulc from Poland). Several poverty and inequality measures are applied to the Polish household data to produce trends in poverty from 1990 to 1997. Updating the official poverty line due to the actual changes in costs of living of the poor demonstrates that recent poverty incidence, contrary to the popular wisdom, decreased substantially below the initial level. At the same time, STATISTICS IN TRANSITION, December 2000 however, the poor became poorer. Alterations in average well- being and inequality almost equally contributed to aforementioned changes. Households of unemployed or low educated persons, those led by females, and families with children are at the highest, persistent risk of poverty. 7. Use of Transformed Auxiliary Variable in the Estimation of Population Ratio in Sample Surveys (by L. N.Upadhyaya, G. N.Singh, AND H. P.Singh from India). The present investigation deals with the problem of estimation of the ratio of two population means using transformed auxiliary variable. Two estimators are proposed and their properties are analysed. Numerical illustrations are given to demonstrate the performance of the constructed estimators over the conventional estimator and the estimators considered by Singh (1965). 8. Sampling and Estimation Methods in Estonian Household Budget Survey (by I.Traat, A. Kukk, K. Sõstra from Estonia). This paper considers the redesign of the sampling and estimation methods of the Estonian Household Budget Survey during 1998- 1999. One of the most radical changes was made in the selection of households. Both the address-rule and person-rule were applied, with inclusion probabilities in the first case calculated solely on the basis of the information in the Population Register. An important improvement was achieved by applying calibration in the estimation stage. Comparisons of the results from the old and from the redesigned survey are given in the paper. The articles are followed by one report, two announcements, obituary and acknowledgements of referees of this volume. The report concerns the International Conference on Establishment Surveys – II, held in Buffalo, USA, June 17-21, 2000, prepared by J. Kotowski . There are two announcements on: (i) The Seminar on “East European Transition and EU Enlargement: A Quantitative Approach", Gdańsk, Poland, June 15-21, 2001. (ii) The IASE Sixth International Conference on Teaching Statistics, Durban, South Africa, July 7-12, 2002; STATISTICS IN TRANSITION, December 2000 The editor announces with the deepest sorrow that Professor Leslie Kish died on 7 October 2000. We co-operated over 25 years. Professor Kish published in our journal an article entitled: The Hundred Years’ Wars of Survey Sampling, Vol. 2, Number 5, December 1995, pp. 813-830. Obituary of Professor Leslie Kish is given in this journal. The issue is concluded with the Acknowledgements of referees of Volume 4. I am pleased to add that last three issues published this year are available to you in electronic format. It is easy to access the Journal on our Web site by keying in the following address: http://www.stat.gov.pl/english/transition.htm Jan Kordos The Editor STATISTICS IN TRANSITION, December 2000 Vol. 4, No.6, pp. 917–927 HEALTH CARE EXPENDITURE IN POLAND IN THE 1990s Alina Baran1 ABSTRACT The author describes the health expenditure in Poland in comparison with that of other countries, changes of its level and structure in the period of transition. State and local governments’ contribution to health care maintenance is indicated on the basis of the share public health expenditure in GDP. The most characteristic change in health expenditure in Poland observed over the period of transition is a significant increase of private expenditure of which over 50% are expenses for medicines. They represent a serious burden especially for low income households, as well pensioners’, large families’, disabled persons’, chronically sick persons’ households. Private health expenditure was derived from the budget household survey. The data presented in the article cover the period of 1991-1998 with the exception of the total public expenditure which extends up to 1999. Introduction It is known that the level of health care expenditure is significantly determined by per capita GDP in a given country [OECD, 1992]. In Poland the per capita GDP turns out to be several times lower than in most European countries (with the exception of several countries from Eastern and Central Europe). Therefore, the level of per capita expenditure on health care is much lower, too. Moreover, in Poland, as compared with other OECD countries, the share of public expenditure on health care in total public expenditure is relatively low (Table 1). This indicates that the significance attached to health care is inferior to that of other items financed from public funds. As a result, according to the OECD statistics, in 1996 per capita expenditure on health care in Poland was above ten times lower than in the USA, nearly three times lower than in the Czech Republic and by 40% lower as compared with Hungary. Between 1986 and 1996 the public expenditure on health care in relation to GDP increased in the majority of comparable countries (e.g. in the Czech Republic from 4.1% to 6.6%). In 1996 1 Central Statistical Office, Warsaw, Al. Niepodległości 208, Poland. 918 A.Baran: Health care expenditure in Poland... only a few countries, such as Korea, Mexico and Turkey indicated lower figures than Poland. Table 1. Health care expenditure in OECD countries in 1986 an 1996 Health care expenditure as % of Public health care Total health care Countries GDP expenditure as % of expenditure per total public Total Public spending capita in USD 1986 1996 1986 1996 1986 1996 1986 1996 Australia 8,0 8,6 5,6 5,9 14,5 16,4 1072 1775 Austria 6,9 8,0 5,3 5,7 10,6 11,1 885 1748 Belgium 7,4 7,8 5,9 6,8 9,7 12,7 934 1708 Canada 8,7 9,2 6,5 6,4 14,1 14,9 1289 2065 Czech 4,5a 7,2 4,1a 6,6 9,9e 15,5 .