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Social Capital: Bridging the Theory and Empirical Divide


  • Brenda Gannon

    () (Academic Unit of Health Economics, University of Leeds)

  • Jennifer Roberts

    () (Department of Economics, The University of Sheffield)


We explore the measurement of social capital in an attempt to bring the empirical work closer to the theoretical literature. Specifically we use the Survey of Health Aging and Retirement in Europe for 2004 and 2006 to construct a composite index of social capital, using principal component analysis. We explore the extent to which the underlying latent factors coincide with the theoretical components of social capital. Our results suggest that the proxy variables load on to four theoretical components. Both men and women have higher social capital in Nordic welfare regimes compared to those in Central or Southern Europe.

Suggested Citation

  • Brenda Gannon & Jennifer Roberts, 2012. "Social Capital: Bridging the Theory and Empirical Divide," Working Papers 2012028, The University of Sheffield, Department of Economics.
  • Handle: RePEc:shf:wpaper:2012028

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    References listed on IDEAS

    1. Stephen Knack & Philip Keefer, 1997. "Does Social Capital Have an Economic Payoff? A Cross-Country Investigation," The Quarterly Journal of Economics, Oxford University Press, vol. 112(4), pages 1251-1288.
    2. Durlauf, Steven N. & Fafchamps, Marcel, 2005. "Social Capital," Handbook of Economic Growth,in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 26, pages 1639-1699 Elsevier.
    3. Sarah Smith, 2010. "Social connectedness and retirement," The Centre for Market and Public Organisation 10/255, Department of Economics, University of Bristol, UK.
    4. Bruni, Luigino & Sugden, Robert, 2000. "Moral canals: trust and social capital in the work of Hume, Smith and Genovesi," Economics and Philosophy, Cambridge University Press, vol. 16(01), pages 21-45, April.
    5. Christelis, Dimitris & Jappelli, Tullio & Padula, Mario, 2010. "Cognitive abilities and portfolio choice," European Economic Review, Elsevier, vol. 54(1), pages 18-38, January.
    6. Deb, Partha & Gallo, William T. & Ayyagari, Padmaja & Fletcher, Jason M. & Sindelar, Jody L., 2011. "The effect of job loss on overweight and drinking," Journal of Health Economics, Elsevier, vol. 30(2), pages 317-327, March.
    7. B. d'Hombres & L. Rocco & M. Suhrcke & M. McKee, 2010. "Does social capital determine health? Evidence from eight transition countries," Health Economics, John Wiley & Sons, Ltd., vol. 19(1), pages 56-74.
    8. B. van Groezen & R. Jadoenandansing & G. Pasini, 2011. "Social capital and health across European countries," Applied Economics Letters, Taylor & Francis Journals, vol. 18(12), pages 1167-1170.
    9. Durlauf, Steven N. & Fafchamps, Marcel, 2005. "Social Capital," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 26, pages 1639-1699 Elsevier.
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    Cited by:

    1. Stephan Humpert, 2013. "Gender Differences in Life Satisfaction and Social Participation," International Journal of Business and Economic Sciences Applied Research (IJBESAR), Eastern Macedonia and Thrace Institute of Technology (EMATTECH), Kavala, Greece, vol. 6(3), pages 123-142, December.

    More about this item


    social capital index; welfare regimes; finite mixture model;

    JEL classification:

    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification


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