Assessing the Causal Impact of Culture on Socio-economic Variables in European Countries

Kristina Mažeikaite˙

Journal of Interdisciplinary Economics, 2025, vol. 37, issue 2, 200-219

Abstract: Despite the growing attention to the impact of culture on socio-economic indicators, there is a lack of causality evidence. Scholars have noted that cultural values or norms, as well as, a vibrant cultural environment can have a positive impact on GDP growth, labour productivity, the attraction of human capital and the improvement of human well-being. However, the issue of endogeneity is not thoroughly debated. Not only can culture impact economic development, but socio-economic environment also affects the cultural indicators. Therefore, it is essential to identify the causal effects of culture. This article aims to assess whether culture has a causal impact on socio-economic variables. The Granger procedure is utilised to evaluate causal relationships, describing the cultural environment with a comprehensive set of 45 cultural indicators across 30 European countries. This enables the comparison of the relationship between culture and socio-economic variables using the same method across different countries. Additionally, cultural indices are constructed. The research is extended by employing a panel vector autoregression (VAR) model. The key finding of this article demonstrates a causal impact of culture on socio-economic indicators, confirmed by both the Granger procedure and panel VAR estimations. JEL Code: Z1

Keywords: Cultural economy; research methods for cultural studies; cultural capital; economics & development studies; Granger causality; panel VAR (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:sae:jinter:v:37:y:2025:i:2:p:200-219

DOI: 10.1177/02601079241232775

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