Influence of Quality of Life on the State and Development of Human Capital in Latvia

Currently, the essence and forms of interrelation between human capital and quality of life are still insufficiently studied. Therefore, there is a need for defining general components of these categories and areas, where human capital interacts with quality of life. Today, Latvia has been developing in difficult conditions: the population is decreasing, emigration is growing, possibilities of employment are limited, and the income of residents is decreasing. All these factors reduce quality of life for the population and lead to the loss of human resources in the country. The existence of a problem stemming from the relationship between quality of life and human capital establishes the relevance of the research and determines its aim. The main contradiction is between the external positioning of the state as a country successfully overcoming crisis and the growth of internal crisis in the state, leading to the further impoverishment of the population, leading to an increased emigration of the working population of Latvia. The main research question is as follows: how to preserve human resources in the state? Based on an analysis of post-crisis socio-economic processes taking place in the society, recommendations are made to improve the socio-economic policy in ways that improve the welfare of the population of Latvia.


Introduction
The current socio-economic situation in Europe and the world, which is suffering a global financial and economic crisis, reveals a number of problems and tasks that must be placed on the agenda with great urgency. Particular concern is caused by a deterioration in the general population's living conditions and, in a broader sense, the quality of life and the health of separate categories and the population groups facing socioeconomic problems.
Finding a solution to the above-mentioned problems for Latvia is critical, as currently, the economy is in both structural crisis and cyclical crisis, as well as difficult political and social changes take place in society.
In the modern conditions of Latvia's development against continuous financial and economic crisis and increasing emigration of Latvian natural citizens to other European Union countries and other countries around the world, the problem of preserving human capital has become more and more real because the developed human capital is the most important factor

Influence of quality of life on the state and development of human capital in Latvia
in the country's competitive advantage in the modern condition of the world's economy. Human capital is the basis of many phenomena, including the stimulation of economic growth. Thus, an increase in human capital by one percent results in an increase in the rate of GDP growth per capita by 1-3%. (Sianesi &Van Reenen, 2003) In this study, human capital is considered not as an end in itself, but as a resource to be used for the social and economic development of a country. The relevance of research into this problem is due to both the objective needs in the present stage of world social and economic development as well as the specifics of the current situation in Latvia, which requires decision makers to ensure sustainable economic growth along with the achievement of a higher level of welfare.
Aim of the research -This research aims to study the influence of human well-being (and, as a result, quality of life) on the development and maintenance of human capital at the macro and micro levels and, on this basis, to develop recommendations for improving the economic and social policies in support of welfare.

Research objectives:
• to analyze and summarize the features of the current stage of Latvian social and economic development from the position of well-being value change; • to reveal how welfare influences human capital and to determine its importance both to achieving economic growth and to increasing the competitiveness of employees and companies; • to justify the need for social and economic policy formation in Latvia to take into account the impact of quality of life and status of the population on human capital saving.
The subject of this research is quality of life's influence on human capital. The research object is social and economic relations in Latvia and the EU. The theoretical basis of this research was made by ideas and concepts presented in classic and contemporary works of scientists on the problems of human capital, welfare, social and labor relations, labor, and social behavior.
An informational basis was made through the results of studies, inquiries, and surveys of the labor and social behavior, as well as statistics. We used scientific methods, such as systemic and situational approach and structural and comparative analysis.

Development of human capital theory
In the late 1950s and early 1960s, the works of Shultz (1971), Becker (1993), Tnurow (1970) were published on human capital theory, and these are now considered classics and have generally shaped its present form. In 1971Shultz (1971 first offered the term "human capital", especially emphasizing the productive character of human capital, its ability to accumulate and to reproduce on a renewable basis. The development of human capital theory continued in studies by Mincer (1975) and Ben-Porath (1967), Krochmal and Staniewski (2010), which was devoted to economically justifying an investment in people. Human capital was understood as the supply of knowledge, skills and qualifications of specific persons, groups of persons and the entire society defining their ability to work, adapt to change, and also act creatively (Białowolski et al., 2011). It is especially worth noting three main components of human capital selected with T. Shultz, which to some extent embodies the value of long-time investments in people, including the following (Solovov, 2009): • The individual qualities used in operation, such as intelligence, energy, overall positive attitude, reliability, and responsibility.
• The motivation to share information and knowledge in the context of command spirit and orientation to joint goals.
The current strategy of most developed countries is now constructed with post-industrial development factors.
It is well-known that human capital plays an important strategic role among internal factors in the development of post-industrial society, both at the macro and micro levels. In particular, at the macro-level, human capital is formed through investments in health care, culture, the improvement of people's living conditions, training in accordance with the future demand of the labor market, and opportunities for fair competition. In turn, the development of human capital at the micro level is shown as the main source of competitiveness, continu-Influence of quality of life on the state and development of human capital in Latvia ous training of employees, social care of employees, and the formation of a corporate culture (Astapov, 2006;Domanski, 2010;Staniewski, 2011). Quality of life as the socio-economic category. of "quality management" and can be seen as a type of control in the "quality of the social circuit" or the social system. Consequently, quality of life is a system concept, and the system includes a quality of person, quality of education, quality of culture, quality of the environment (ecology), and the quality of social, economic and political organization.
When describing the nature of quality of life as a social and economic category, it is necessary to highlight a few of its features: the quality of life is not a category separated from other socio-economic categories, but combines many of them and includes them in a qualitative aspect. Life quality is an extremely broad, multi-dimensional, multi-faceted concept, incomparably greater than the idea of "standard of living." This is a category that goes far beyond the economy. It is primarily a sociological category, covering all sectors of society as they all embody the lives of people and its quality.
Recently, the term "quality of life" is perceived in the two interpretations: the broader and the relatively narrow. The term "quality of life" in its broad sense refers to the satisfaction of the population with their lives from the point of view of their different needs and interests. It covers the following issues: characteristics and indicators of living as an economic category, the conditions of work and leisure, housing, social security and warranties, protection of law and order and respect for human rights, climate conditions, parameters of the environment, the availability of free time and the opportunity to know how to use it, and finally, the subjective feeling of peace, comfort and stability.
The second meaning of the term "quality of life" is narrower (for example, in the phrase "the level and quality of life"); this term covers the listed characteristics without actually including living in its economic sense (income, cost of living, consumption).
According to the onion theory of happiness (Czapiński, 2001;2004;2011a), the most peripheral • pathology -alcohol abuse and drug use, smoking, consulting a psychiatrist or psychologist, being a criminal or victim of crime (burglary, assault, and theft). (Czapiński, 2011b) Life quality of the Latvian population.
Latvia also was placed by U.N. experts into a subgroup of the countries with very high level of development.
Our country took 44th place in the overall ranking.  Poverty imply a situation where a household does not have sufficient financial resources (both cash in the form of current income and income from previous periods and accumulated fixed assets) to satisfy its basic needs. Panek, 2011).
As for Latvia, the ill-conceived reform of its national economy has led not only to the impoverishing of socially vulnerable groups, such as the elderly, the disabled, and families with many children, but also to a depreciation of human capital, which remains unclaimed and does not act as a catalyst for economic growth. Therefore, high levels of poverty and unemployment not only reduce the standard of living but also lead to underuse of economic potential and accumulated human capital. In combination with infla- in any other country of the European Union. This is evidenced by the published revised data from Eurostat (Eurostat, 2011 lead to a universally aging population and the total inability of the country to carry out its public functions. As for the general state of health and medicine in Latvia, we have to admit that, as measured by the main indicators of public health, Latvia confidently takes last place among the group of countries that joined the EU in 2004. Latvian residents die at a rate that is 1.5-to 2-times higher than rates in developed Europe, and children up to one year die at an almost threetimes-higher rate more often. Moreover, male life expectancy is 10 years less than in Europe, and only half of the children younger than 14 years can be considered healthy. Especially troubling is the fact that in the last five years, no changes to improve the situation were observed. The picture is completed by epidemics of infectious diseases: episodes of child and intestinal infections, during which the incidence exceeds the European rate by ten times, the epidemic of sexually transmitted diseases (even among children) and AIDS (only registered incidence is by 10 times higher than European), the incidence of tuberculosis is higher by 10 times than that of Europe.
The problem is exacerbated by a chronic and widening health system crisis, which in its current form, does not correspond to the internal needs of the population, nor to European ideology and practice.
A study named "Trends in social and economic development of cities in Latvia, " conducted at the request of the State Regional Development Agency, shows that only 49.35% of Latvian residents were satisfied with a quality of their life, which is less than half (State Regional Development Agency, 2008).
In summary, the current situation of more than half of Latvian residents creates large difficulties for the positive development of the economy of Latvia in the present and near future. The consequence of continuously deteriorating welfare is the loss of the country's human resources and, in the long term, the country's lack of strategic development potential.
The ability for Latvia to overcome this crisis is impossible without shifting the existing socio-economic policies and infrastructure of the Latvian national economy towards increasing the industrial and agricultural weight, as a basis for adding value and improving the performance of social infrastructure and societal development. This is needed to develop the concept of strategic development by defining priority sectors, which will be based on the economy of Latvia. The government's tactics, aimed at survival by consolidating the budget through reductions and cuts, must give way to thinking oriented towards future development.
In the long run, a strategy for state development based on public investment in social infrastructure and human resources is a prerequisite for the longterm socio-economic development of Latvia.