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Does Social Cohesion Really Promote Reforms?

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  • Hannes Andréasson
  • Niklas Elert
  • Nils Karlson

Abstract

This paper investigates whether social cohesion makes economic reforms more likely. First, we investigated whether social cohesion is a coherent concept by using a principal-component factor (PCF) analysis covering 16 indicators used to measure social cohesion in the previous literature for 40 different countries. The results suggested that in fact social cohesion is a multidimensional concept, consisting of no less than five orthogonal components or distinct dimensions, which we labeled social divisions, modern values, traditional nationalism, institutional commitment, and fairness as merit. The dimensions are then examined in relationship with economic reform in a panel regression framework. Results show that most dimensions of social cohesion do not in fact influence reform capacity. However, views of fairness based on merit, in contrast to equality, and to some extent social divisions, are found to have a positive effect on economic reforms. The results go against the previous literature, challenging the prevailing view of social cohesion as being unambiguously beneficial to economic reform.

Suggested Citation

  • Hannes Andréasson & Niklas Elert & Nils Karlson, 2013. "Does Social Cohesion Really Promote Reforms?," WWWforEurope Working Papers series 33, WWWforEurope.
  • Handle: RePEc:feu:wfewop:y:2013:m:7:d:0:i:33
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    Cited by:

    1. repec:wfo:wstudy:58791 is not listed on IDEAS
    2. repec:feu:wfedel:y:2016:m:2:d:0:i:12 is not listed on IDEAS
    3. Karl Aiginger, 2016. "New Dynamics for Europe: Reaping the Benefits of Socio-ecological Transition. Synthesis Report Part I," WWWforEurope Deliverables series 11, WWWforEurope.
    4. Gunther Tichy, 2015. "Protecting social inclusion and mobility in a low growth scenario," WWWforEurope Working Papers series 100, WWWforEurope.

    More about this item

    Keywords

    Social cohesion; welfare state; reform; economic freedom;

    JEL classification:

    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • O43 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Institutions and Growth
    • P00 - Economic Systems - - General - - - General
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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