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BOCCONI UNIVERSITY

Academic year 2009/2010

1) we declare that this written assignment is our own work and does not include
material
from published sources used without proper acknowledgment or material copied
from
the work of other students
2) we declare that this assignment has not been submitted for assessment in any
other
course at any university.
3) we have a photocopy or electronic version of this assignment in our possession.

Munteanu Vladimir Yuliya Pauliukevich Racul Iulian

ID 1237551 ID 1377381 ID 1325240

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We found that there is a worldwide problem of low levels of trust in government

institutions in general and in parliaments in particular. In this project our team analyzes
the essential factors that influence the overall level of people¶s trustiness in country¶s
parliament. The study presents and analyses the data trying to draw the main
conclusions related to our problem. The main statistical tests used in the project are
Factor analysis and Regression analysis. First of all, we made an accurate selection of
eight variables, strongly related to the main argument. Then we used the data on these
variables in the analysis, using the tests mentioned above.
The second step in our project was to define the two main factors, with different
covariates, which were used further in the Regression analysis. Thanks to Factor
Analysis we found two factors that stand for two fundamental characteristics of the level
of people¶s trust in the country¶s legislative institution, which are Security and Wellbeing.
It was important for us to find and to select the most relevant variables and to
demonstrate the linkage among them. That is why we tried to do a ³logical´ analysis and
to select the most appropriate and interesting variables to describe and support better
the main idea of our project. We considered the relationship among such broad issues,
as health, safety, happiness, and democracy could explain the attitude of the population
towards the parliament.
Considering people as rational individuals we also took into account the
attitudinal difference between males and females. That is why we also included the
variable ³Gender´ in order to stress the attention on this important issue. In this way we
tried to investigate how gender differences influence the general trust of people in
parliament.
Important to mention is the fact that after doing the analysis of the missing
values, we realized that we can consider further all the variables which were initially
selected because the values for all the variables selected seem to be available. The
study examined public opinion in depth and detail and several important conclusions
emerged from it concerning public opinion and the level of public trust in the legislative
institution. Our initial assumption was that Security will play a bigger role in the subject
matter, as it is the main concern of people. As it turned out, Wellbeing has a much
bigger impact on the dependent variable and it was a bit of a surprising result. Also we
hereby wanted to assess the influence of immigration, which is a rather new issue, on
the trust on parliament. As it proved to be, its role is indeed an important one and we
can assume that it will rise in the future. We consider all these results very of rather
great significance and we want to stress their usefulness for any administrative unit that
studies the consequences of the reforms of the parliament towards the trust of the
population in this legislative body.

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The relevant professional literature deals with the term ³trust´ in various spheres
of the Social Science; with explanations on the state and international levels of the
phenomenon of low levels of trust in government institutions in general and parliaments
in particular; with the degree to which the phenomenon threatens democracy; and with
reforms that can be introduced in order to bring about a change in the trend. In our
research we deal with the first issue - of democracy, but leave the floor to politicians in
deciding which reforms should be made in order to increase the confidence of people in
politicians, or, in particular, the Parliament.
Many parliaments have introduced reforms that are designed to improve the
connection between themselves and the public, and there is an expectation that the
reforms (which we consider as a main tool in gaining population confidence in the
legislative body) will have an effect, at least indirectly, on the level of trust in them. In
fact, the reforms have had little effect on public trust, because the low level of trust
apparently results more from social and cultural developments (the issues we tried to
analyze, such as general level of happiness, satisfaction, safety or health) than from
objective reasons, connected with the functioning of the parliaments.
We found that several international organizations have been dealing in recent
years with the decline in public trust in government institutions, and its ramifications. In
a report prepared in 2005 for the OECD it was found that many states, which are
members of the Organization have started to focus attention on strengthening relations
with their citizens as a result of the decline in the rates of participation in the elections,
in the rates of membership in political parties, and in the trust that the public expresses
in central public institutions, including parliaments.
From the information and data gathered from different sources we found out that
the decline of the public trust in parliaments in most of the states has taken place in the
last 10-15 years.
It was interesting to discover that the level of trust which the public has in
parliament does not necessarily correspond to that in members of the parliament. There
are states in which the members of parliament enjoy greater trust than does the
parliament ± especially in countries in which the members are elected in direct
elections. The main reason for the difference is that the expectations from them as
individuals are different than the expectations from the parliament as a body. In several
countries it is the parliament which enjoys greater trust.
The conclusion we draw from examining researches and analysis already done is
that almost all were analyzing the public opinion on political issues (such as reforms,
confidence in the members of parliament etc.), while we are trying to deal with this
problem from a social subjective point of view, explaining how actions of parliaments
influence people¶s general state.

Let¶s define the steps we followed in our Applied Research process:

1. Defining the problem (which we have already done)

2. Collecting the data (from Database ³Life Course and Attitudes; EES Round 3
2006/2007)
3. Processing the data (Screening & Cleaning)
4. Analysing the data (Factor Analysis and Regression Analysis)
5. Drawing conclusions
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There are many sources for comparative data regarding the level of public trust
in government institutions, including parliament. We decided to use the data set drawn
from Round 3 of the European Social Survey (ESS), conducted in 2006/2007 by the
European Commission, the European Science Foundation and various scientific funding
bodies. The ESS3-2006 main questionnaire is made up of the core module and two
rotating modules: Timing of life (the organization of the life course in Europe) and
Personal and social well-being (creating indicators for a flourishing Europe). ³Timing of
life´ module aims at furthering our understanding of the views of European citizens on
the organization of the life course and of their strategies to influence and plan their own
lives. ³Personal and social wellbeing´ module seeks to evaluate the success of
European countries at promoting the personal and social well-being of their citizens.
As mentioned above, we tried to include our variables under some more general
social issues. So, we divide our variables into 4 groups, each group representing one
general social issue:
I.
  (here we included the variable concerning happiness + the variable
about the general satisfaction with standard of living);
II. ( (the variable concerning immigration (bad or good for country's
economy));
III.
c(here we deal with the variable regarding the subjective opinions on
general health + the variable on worry about becoming victim of violent crime has
effect on quality of life);
IV. !c(here we refer to the variable about how often people worry about their
home being burgled + how safety they feel of walking alone in local area after
dark);
c
" the variable ³Gender´ which we use for the Regression Analysis.

Now, we will try to describe every variable and to demonstrate their relevance to
our main problem question: ³trust in county¶s parliament´. It is appropriate to start our
data description with the dependent variable, which is, also, our main research question
and then to continue, one by one, explaining the independent variables.

y    (dependent variable)# measures on a scale from 0 to 10 the extent to

which the interviewed person has confidence, or, trust in country¶s parliament. In
this case, 0 means ³no trust at all´ up to 10 which means ³complete trust´;c
y  $ c(independent variable): measures on a scale from 1 to 4 the extent to
which the interviewed person worries about becoming a victim of violent crime. In
this case , 1 means ³all or most of the time´ up to 4 which means ³never´;c
y O %
$ c(independent variable): measures on a scale from 1 to 4 the extent
to which the interviewed person worries about their home being burgled. In this
case, 1 means ³all or most of the time´ up to 4 which means ³never´;c
y 
( & (independent variable): measures on a scale from 1 to 4 the extent to
which the interviewed person worries about feeling of safety of walking alone in
 local area after dark. In this case, 1 means ³very safe´ up to 4 which means ³very
unsafe´;c
y


c(independent variable): measures on a scale from 1 to 5 the extent to
which the interviewed person worries about subjective general health. In this
case, 1 means ³very good´ up to 5 which means ³very bad´;c
y
 ' (independent variable): measures on a scale from 0 to 10 the extent to
which the interviewed person is happy. In this case, 0 means ³extremely
unhappy´ up to 10 which means ³extremely happy´;c
y ( (independent variable): measures on a scale from 0 to 10 the extent to
which the interviewed person is satisfied with standard of living. In this case, 0
means ³extremely dissatisfied´ up to 10 which means ³extremely satisfied´;c
y O%
( (independent variable): measures on a scale from 0 to 10 the extent
to which the interviewed person consider immigration bad or good for country's
economy. In this case, 0 means ³bad for the economy´ up to 10 which means
³good for the economy´c
y And finally, %( : identifies if the interviewed person is male or female. In this
case this we are dealing with a Dummy variable. Originally the dataset provided
us with values 1 for ³male´ and 2 for ³female´. We decided to change the
variable¶s values to 0 for ³male´ and 1 for ³female´. We decided to make the
change in order to show the distinction between males and females in a more
comprehensible way.c
c
Before initiating the main data analysis we considered appropriate to list the main
assumptions for the two tests we are using in this research.

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I. E (İ) =0 so that estimators are unbiased

II. Var (İ) = 0 so that there are no heteroskedasticity problems
III. Cov (İi, İj) = 0 so that the error are not correlated with one another
IV. Cov (İi, xi) = 0 so that the errors are independent from the values

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I. Large enough sample to yield reliable estimates of the correlations among the
variables
II. Statistical inference is improved if the variables are multivariate normal
III. Relationships among the pairs of variables are linear
IV. Absence of outliers among the cases
V. Some degree of collinearity among the variables but not an extreme degree or
singularity among the variables
VI. Large ratio of N / k
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The goal of data screening is to identify, and remedy, any problems with data
prior to beginning the data analyses that will address the research question. This is a
necessary step because data problems can produce misleading (invalid or unreliable)
results or make it difficult or impossible to run the desired analysis. The most frequent
and common problems encountered with the data are: social desirability bias; inability to
answer questions, resulting in missing values; random response; sabotage; accidental
errors; interviewer effect (intentional or non-intentional influence on responses) etc.
First of all, we run a Missing Value analysis to detect if values for one or more
variables might be unavailable. The results we concluded from the following table:

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a
Missing No. of Extremes

N Mean Std. Deviation Count Percent Low High

crvctwr 42457 3.23 .824 543 1.3 1244 0

brghmwr 42571 3.04 .910 429 1.0 2489 0

aesfdrk 42414 2.07 .821 586 1.4 0 2409

imbgeco 40437 4.93 2.494 2563 ,-.c 0 1340

happy 42615 7.14 2.059 385 .9 2670 0

health 42919 2.29 .931 81 .2 0 755

stfsdlv 42754 6.46 2.400 246 .6 2044 0

gndr 42903 97 .2

a. Number of cases outside the range (Mean - 2*SD, Mean + 2*SD).

When dealing with missing values one should decide whether a variable with a
high proportion of missing values should be dropped from the analysis. The advantage
is that we use only ³known´ data, while the disadvantage is that we may lose an
important variable. So, we encountered this dilemma in our analysis of missing values
with the variable O%
(cwhich showed a pretty large percentage of missing values
(6%). We considered this variable important for our further analysis, so we decided to
keep it and to rely on it.
One further step after the missing values analysis is to start examining the data
for impossible or improbable values or doing univariate data screening:
Since we have only variables that are based on a metric scale and a dummy
variable, the influence of impossible values is rather minor. Also in each of these
variables there is a specific value that is excluded, that represents these cases.
The same reasoning applies when comparing the values of the variables with the
Mean +/- Standard Deviation in order to find the extreme values or outliers. Since all
variables are measured on metric scale and we have a dummy variable, we exclude this
case also.
The normality condition is a very important one and we verified it by comparing
the module of kurtosis of each distribution of the variable to be less the 1. All variables
passed the test with a single exception, the variable GNDR. But, as it is a dummy
variable, it is not unusual to have a rather non-normal distribution. But, regarding the big
sample size, we continue to use and rely on it because it will be very useful in the
regression analysis.
Since all the data has been cleaned and screened, we can proceed to the two
methods of Multivariate Analysis: Factor Analysis and Regression Analysis.

+c c
The first step in the Multivariate Analysis is the c c/0. FA is a
method of data reduction in which we use a small set of factors (new variables) in order
to try to represent the common behavior of a larger set of observed variables. Our
decision was to reduce the 6 variables that represent the feeling of security of the
respondents and the general wellbeing of the respondents. These variables are
CRVCTWR, BRGHMWR, AESFDRK (representing the security) and HEALTH, HAPPY,
STFSDLV (representing the wellbeing).
The first thing that we can observe is the sample size which is well above 1000.
This is a very good beginning in order to find correlations and appropriate factors. After
the screening and cleaning of the data, we will do two tests to verify if there is enough
correlation in the data set. The tests are Kaiser-Meyer-Olkin (KMO) and Barlett¶s test of
sphericity. We used SPSS in order to obtain them as shown below.

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Kaiser-Meyer-Olkin Measure of Sampling .683
Adequacy.
Bartlett's Test of Approx. Chi-Square 8040.74
Sphericity 7
df 15
Sig. .000

Also we verified that the determinant of the correlation matrix to be different than
0. In our model this Determinant is 0.294 and this means that there is no sign of
multicollinearity. The KMO is the ratio of the sum of all squared correlations in the
sample to the sum of all squared correlations plus the sum of all squared partial
correlations. Although it should be >0.7 in order to be satisfactory, our result 0.683 is
 quite close. Barlett¶s test of sphericity compares our correlation matrix with an identity
matrix. In our case, Sig=0.000, so the difference between those two is significant.
The next step is to continue to finding the actual factors. The fact that all the
communalities were above the acceptance level, pointed out the idea that no variables
should be excluded. The Total Variance Table can point out the important factors by
comparing the Eigenvalues that are greater than 1. The factors that show an
Eigenvalues less than 1 are useless and explain no more than a simple variable, so
incorporating them into a factor is not desirable. The table was created in SPSS.

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2 
Component Extraction Sums of Squared Rotation Sums of Squared
Initial Eigenvalues Loadings Loadings
% of Cumulative % of % of Cumulative
Total Variance % Total Variance Cumulative % Total Variance %
1 2.426 40.432 40.432 2.426 40.432 40.432 1.938 32.305 32.305
2 1.351 22.519 62.951 1.351 22.519 62.951 1.839 30.645 62.951
3 .793 13.217 76.168
4 .618 10.303 86.471
5 .421 7.016 93.487
6 .391 6.513 100.000
Extraction Method: Principal Component Analysis.

As we can see from the table, the first two factors are the reliable ones. The first
has an Eigenvalue of 2.426, explains 32.305% of the variance and includes three
variables: CRVCTWR, BRGHMWR and AESFDRK. This factor represents the
SECURITY. The second reliable factor has an Eigenvalue of 1.351, explains 30.646%
(with a cumulative percentage with the first of 62.951%) and includes also three
variables: HEALTH, HAPPY, STFSDLV . This factor represents the WELLBEING.
A further confirmation of our conclusions is the Scree Plot representing on the X-
axis the number of the factors and on the Y-axis the Eigenvalues. As we can observe
from it, after the first two factors, the curve becomes flatter and goes below Eigenvalue
1.
 The following and the last table will be the Rotated Factor Matrix. It presents all
the details connection between each variable and the Factors. The values that were not
significant have been erased. As we can observe, the Rotation method was Varimax
with Kaiser Normalization.


c  c2
Component
1 2
how often worry about .839
becoming a victim of violent
crime
how often worry about your .837
home being burgled
feeling of safety of walking -.701
alone in local area after dark
subjective general health -.574
how happy are you .862
satisfied with standard of .838
living
Extraction Method: Principal Component Analysis.
Rotation Method: Varimax with Kaiser Normalization.
a. Rotation converged in 3 iterations.

This test provides the necessary information about the strong correlation
between the factors with each of the variables. Although every value is above 0.5
(which is the acceptance level), we observe two relative low values. The first is ³feeling
of safety walking alone in the local area after dark´ with -0.701 and ³subjective general
health´ with -0.574. Our assumption about these low values is about the fact that both of
them have a negative correlation with respect to the others. This means that they are
measured on a reversed scale with respect to the other variables, but nevertheless are
important and significant, so they must not be excluded.
The final conclusions that can be made out of Factor Analysis are several
important ones: the first is that 6 variables were reduced to two factors; the first factor
explains SECURITY and the second one explains WELLBEING; and finally that these
two factors explain 62.951% of the covariance among variables.

The second step in the Multivariate Analysis is the ) c c/ 0.
RA is a method that is useful in two ways. Namely, the possibility to predict the value of
a dependant variable based on the values of some independent variables and also to
predict the impact of changes in the independent variable on the dependant variable. In
this case we use as a dependent variable TRSTPRL (trust in country¶s parliament) and
as independent variables we take the two factors obtained in the factor analysis and
also GNDR and IMBGECO. The final result of the analysis will make us come closer to
the answer of the question: ³Which factors influence the trust in the parliament and by
what means?´
The first step is to measure the correlation between our two factors (SECURITY
and WELLBEING), GNDR and IMBGECO. We can do so by making a Coefficients
Table and discuss the significance of each variable.


!! 
Model Unstandardized Standardized Collinearity
Coefficients Coefficients Statistics
B Std. Error Beta t Sig. Tolerance VIF
1 (Constant) 3.339 .119 27.972 .000
SECURITY .271 .032 .108 8.371 .000 .942 1.062
WELLBEING .710 .032 .279 22.085 .000 .977 1.024
immigration bad or .131 .012 .136 10.692 .000 .968 1.033
good for country's
economy
gender -.122 .064 -.024 -1.905 .057 .948 1.055
a. Dependent Variable: trust in country's parliament
 The first thing to be discussed is the comparison between the significance level
of each of the variables and 0.05 which is the acceptance level. As we can see, each of
the significance variables is 0.00 (which is below 0.05) and the sole exception is gender
which is slightly above 0.5 with a value of 0.57. Nevertheless we will continue with this
variable and use it in our Regression Analysis because it is an important variable and it
might be useful to compare the results from the model with the facts from the real life.
The next step is to exclude the possibility of variables with a high level of collinearity.
The acceptance level in this case is a VIF <10. Multicollinearity might become an issue
in other case. In our case, as we can observe from the table, VIF has values between
1.024 and 1.062 and excludes this situation.
When analyzing the obtained coefficients we come to some interesting
conclusions. The first conclusion is that besides the equal level of significance between
the two factors, we observe that a change in WELLBEING influences the dependent
variable much more than a change in any other variable. Even if for every one of us,
security might seem the most important thing, our model predicts that the trust in
parliament is more influenced by how we feel about life and health. Our assumption for
this phenomenon is that the mentality of a great majority of people is that parliament
has a much bigger influence in the economic and social life of a person. Security, on the
other hand, is more the responsibility of each of us. We must take appropriate
measures in order to guarantee the high level of security for us and our families.
Another conclusion that we can draw from looking at the coefficients is the ascending
role of the emigrants in the collective mentality. The assumption is that an unwise
change in the policy of the parliament or government towards the emigrants might affect
the collective trust in the parliament rather serious. Finally, as we expected, given the
fact that we changed the variable GNDR (³0´ to female and ³1´ to male), there is a
minus sign in front of the coefficient. We will explain the role of this dummy variable
latter on.
Although we have a sample with a very big number of respondents, we have to
build in SPSS a Normal Probability Plot in order to compare the observed distribution of
the error term with a theoretical normal one. As we can see below, the observed points
practically follow the straight line and so, the assumption holds.
 Another important step in analyzing the model is to analyze R2. It is the square of
the correlation coefficient and explains how good is the regression at approximating the
real data provided in the survey. Its value is showed below in the table.
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Model Adjusted R Std. Error of the
R R Square Square Estimate Durbin-Watson
a
1 .353 .125 .124 2.327 1.687

a. Predictors: (Constant), gender, REGR factor score 2 for analysis 18, immigration bad
or good for country's economy, REGR factor score 1 for analysis 18
b. Dependent Variable: trust in country's parliament

As we can see, R2 is equal to 0.125, which means that, roughly speaking, with
our model we explain approximately 13% from the real data. Even that this number is
not so high, it would be rather difficult to predict the values of such a broad variable with
such few factors. Trust in parliament and in politics in general is a complex life issue
and it is very hard to be predicted. Almost infinitely many things influence the opinion of
different people and we selected those that seemed with the highest level of
significance. One last thing to be observed is the fact that Durbin-Wattson statistic value
is somewhere around 2, precisely 1.687. This is a proof that there is very little
autocorrelation between the error terms and there is very little bias of the outcome of
our analysis.

The final step, after checking all the issues and deviations that might have
influenced the result, is to write the Regression Equation that we obtained:

Trust in Parliament=3.339+0.271*SECURITY+0.710*WELLBEING+0.131*IMBGECO-
0.122*GNDR

We observe that the only negatively correlated variable is GNDR and depending
on what value it takes, it affects the trust in parliament. The only two possible values are
³0´ for female and ³1´ for male so we have two situations:
For female:
Trust in Parliament=3.339+0.271*SECURITY+0.710*WELLBEING+0.131*IMBGECO

For male:
Trust in Parliament=3.339+0.271*SECURITY+0.710*WELLBEING+0.131*IMBGECO-
0.122*1
As we have been expected, the known fact that men are more interested in
politics makes them more reluctant in trusting the parliament, which is the way
democratic societies manifest legislative powers. Also the rest of the factors and
variables are positively correlated and induces the idea that the main method from
which the parliament as an institution can gain trust is by promoting policies and laws
sustaining security, wellbeing and other vital attributes of modern life. An important
achievement of our project was also to prove a rather big importance of the immigrants
in the mentality of the society. Our group also thinks that, as the time passes, and
immigrants became a part of our life, the significance and the impact of this ³variable´
will increase.

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In the end there are several conclusions that can be made after executing all
these analyses. First of all are the facts that behave on the paper as they do in reality.
Security and Wellbeing have a positive influence on our trust in the parliament. We tend
to trust politicians in general when we feel satisfied with life, feel no threat for our
personal security and commonly when we feel good. From these considerations, any
politician should realize that he represents the institution that is the supreme form of
democracy and is responsible for what he does or says. An interesting result was the
fact that wellbeing has a much more influence on the dependent variable. As we have
mentioned already, this is due to the fact that the policies and laws influence mainly the
people¶s wellbeing and so the expectations and the influence on these measures are
greater. The singles variables that we have chosen, about immigrants and gender,
involved two common issues. The first one is a rather recent one and was preceded by
globalization and liberating the labor markets and the second one is about the
difference in opinion of different sexes. As we stressed before, the policies towards
immigrants prove to have an important weight in the common mentality of the people
and this influence will rise for sure. The result about the difference in opinion between
men and women was predictable. Those who are more interested in politics, namely the
men, have less trust in parliament and its reforms.
Finally, we hope that with this research project we provided some insight about a
general issue such the peoples¶ trust in parliament. It might be very handy to use these
results if in the future we¶ll be in the posture of a policymaker or to extend our research
in order to get a better function for our dependent variable.

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