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Abstract

We assess the causal relationship between health and social capital, measured by generalized trust, both at the individual and the community level. The paper contributes to the literature in two ways: it tackles the problems of endogeneity and reverse causation between social capital and health by estimating a simultaneous equation model, and it explicitly accounts for mis-reporting in self reported trust. The relationship is tested using data from the first four waves of the European Social Survey for 26 European countries, supplemented by regional data from the Eurostat. Our estimates show that a causal and positive relationship between selfperceived health and social capital does exist and that it acts in both directions. In addition, the magnitude of the structural coefficients suggests that individual social capital is a strong determinant of health, while community level social capital plays a considerably smaller role in determining health.

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Bibliographic Info

Paper provided by HEDG, c/o Department of Economics, University of York in its series Health, Econometrics and Data Group (HEDG) Working Papers with number 11/21.

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Date of creation: Jul 2011
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Handle: RePEc:yor:hectdg:11/21

Contact details of provider:
Postal: HEDG/HERC, Department of Economics and Related Studies, University of York, York, YO10 5DD, United Kingdom
Phone: (0)1904 323776
Fax: (0)1904 323759
Email:
Web page: http://www.york.ac.uk/res/herc/research/hedg/
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This paper has been announced in the following NEP Reports:

• NEP-ALL-2011-08-15 (All new papers)
• NEP-HEA-2011-08-15 (Health Economics)
• NEP-SOC-2011-08-15 (Social Norms & Social Capital)

References

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1. Zak, Paul J & Knack, Stephen, 2001. "Trust and Growth," Economic Journal, Royal Economic Society, vol. 111(470), pages 295-321, April.
2. Scheinkman, Jose A. & Soutter, Christine L. & Glaeser, Edward Ludwig & Laibson, David I., 2000. "Measuring Trust," Scholarly Articles 4481497, Harvard University Department of Economics.
   
   • Edward L. Glaeser & David I. Laibson & José A. Scheinkman & Christine L. Soutter, 2000. "Measuring Trust," The Quarterly Journal of Economics, MIT Press, vol. 115(3), pages 811-846, August.
3. Hurtado, David & Kawachi, Ichiro & Sudarsky, John, 2011. "Social capital and self-rated health in Colombia: The good, the bad and the ugly," Social Science & Medicine, Elsevier, vol. 72(4), pages 584-590, February.
4. Engström, Karin & Mattsson, Fredrik & Järleborg, Anders & Hallqvist, Johan, 2008. "Contextual social capital as a risk factor for poor self-rated health: A multilevel analysis," Social Science & Medicine, Elsevier, vol. 66(11), pages 2268-2280, June.
5. Durlauf,S.N., 2001. "On the empirics of social capital," Working papers 3, Wisconsin Madison - Social Systems.
   
   • Steven N. Durlauf, 2002. "On the Empirics of Social Capital," Economic Journal, Royal Economic Society, vol. 112(483), pages 459-479, November.
6. Veenstra, Gerry, 2000. "Social capital, SES and health: an individual-level analysis," Social Science & Medicine, Elsevier, vol. 50(5), pages 619-629, March.
7. Ghosh, Parikshit & Ray, Debraj, 1996. "Cooperation in Community Interaction without Information Flows," Review of Economic Studies, Wiley Blackwell, vol. 63(3), pages 491-519, July.
   
   • Parikshit Ghosh & Debraj Ray, 1995. "Cooperation in Community Interaction Without Information Flows," Boston University - Institute for Economic Development 64, Boston University, Institute for Economic Development.
8. Nicolas Sirven & Thierry Debrand, 2011. "Social Capital and Health of Older Europeans," Working Papers DT40, IRDES institut for research and information in health economics, revised Feb 2011.
9. Iversen, Tor, 2008. "An exploratory study of associations between social capital and self-assessed health in Norway," Health Economics, Policy and Law, Cambridge University Press, vol. 3(04), pages 349-364, October.
   
   • Iversen, Tor, 2009. "An exploratory study of associations between social capital and selfassessed health in Norway," HERO On line Working Paper Series 2007:9, Oslo University, Health Economics Research Programme.
10. Stavros Petrou & Emil Kupek, 2008. "Social capital and its relationship with measures of health status: evidence from the Health Survey for England 2003," Health Economics, John Wiley & Sons, Ltd., vol. 17(1), pages 127-143.
11. Giacomo De Giorgi & Michele Pellizzari & Silvia Redaelli, 2010. "Identification of Social Interactions through Partially Overlapping Peer Groups," American Economic Journal: Applied Economics, American Economic Association, vol. 2(2), pages 241-75, April.
12. Senik, Claudia, 2004. "When information dominates comparison: Learning from Russian subjective panel data," Journal of Public Economics, Elsevier, vol. 88(9-10), pages 2099-2123, August.
13. Steven Stern, 1989. "Measuring the Effect of Disability on Labor Force Participation," Journal of Human Resources, University of Wisconsin Press, vol. 24(3), pages 361-395.
14. Lucas Ronconi & Timothy T. Brown & Richard M. Scheffler, 2012. "Social capital and self‐rated health in Argentina," Health Economics, John Wiley & Sons, Ltd., vol. 21(2), pages 201-208, 02.
15. Fujisawa, Yoshikazu & Hamano, Tsuyoshi & Takegawa, Shogo, 2009. "Social capital and perceived health in Japan: An ecological and multilevel analysis," Social Science & Medicine, Elsevier, vol. 69(4), pages 500-505, August.
16. Winkelmann, Liliana & Winkelmann, Rainer, 1998. "Why Are the Unemployed So Unhappy? Evidence from Panel Data," Economica, London School of Economics and Political Science, vol. 65(257), pages 1-15, February.

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