THE EFFECT OF MACRO-LEVEL SOCIAL CAPITAL ON SUSTAINABLE ECONOMIC DEVELOPMENT

Helje Kaldaru and Eve Parts

No 42, University of Tartu - Faculty of Economics and Business Administration Working Paper Series from Faculty of Economics and Business Administration, University of Tartu (Estonia)

Abstract: The concept of social capital as an important determinant of economic development is attracting increasing attention among development economists. The present paper analyses the impact of macro-level social capital on economic development in 34 European countries. Macro-level social capital comprises different aspects of institutional quality and is closely related to the income distribution and social cohesion. We used principal component analysis to group initially selected social determinants of economic development into three components (human and social capital, income equality, and redistribution), which altogether described 64.4% of the variation of the initial variables. Following regression analysis proved that all these components have a positive effect on economic development, measured by human development index.

Keywords: social capital; economic development; sustainability; European economies (search for similar items in EconPapers)
Pages: 52 pages
Date: 2005
New Economics Papers: this item is included in nep-dev and nep-soc
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Persistent link: https://EconPapers.repec.org/RePEc:mtk:febawb:42

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