Financial Situation of Local Government Units as a Determinant of the Standards of Living for the Polish Population

In this paper, the author intends to show the interaction between the living standards of the population and the financial situation of Polish local government units at the commune level. The first (theoretical) part of the paper provides a synthetic description of topics related to defining the economic terms and to the local government’s ability to impact the standards of living of the local population. In view of the multifaceted nature of terms covered by this analysis, the second part uses a canonical analysis (which means multiple linear regressions are generalized for two sets of variables) in order to identify the relationships between them. The analysis resulted in identifying a number of indicators, including canonical correlations, total redundancy and variances extracted, as well as six statistically significant canonical variates, which enabled the identification of multidimensional relationships between the categories considered. The greatest and the most statistically significant canonical correlation coefficient was over 0.93; for the last statistically significant canonical variate, it was over 0.57. The analysis provides grounds for concluding that when the values of variables representing the financial capacity of Polish rural communes are known, they can be used to explain over 32% of the variance in the set of variables relating to the population’s standards of living. The statistical data originated from the author’s own surveys carried out with presidents and vice-presidents of commune councils.