The relationship between social capital and economic growth on a provincial and regional basis

Authors

DOI:

https://doi.org/10.18559/ebr.2023.3.799

Keywords:

GDP, social capital, economic growth, panel causality analysis

Abstract

The aim of this study is to investigate the relationship between economic growth and social capital on both a provincial and regional basis in Turkey during the period of 2007-2018. In the study, in which the social capital index was used as a current and comprehensive variable to represent social capital, the relations between the variables were analyzed with the panel Granger causality test. As a result of the empirical analysis, it was determined that there is a unilateral causality relationship from GDP to SOCAP in 16 provinces, from SOCAP to GDP in 9 provinces, and bilateral causality in 45 provinces. On the other hand, no significant relationship was found in 11 provinces.

Downloads

Download data is not yet available.

References

Akçomak, I. S., & Bas ter Weel. (2008). Social capital, innovation and growth: Evidence from Europe. IZA Discussion Papers, 3341.
View in Google Scholar DOI: https://doi.org/10.2139/ssrn.1294524

Alesina, A., & La Ferrara, E. (2000). Participation in heterogeneous communities. Quarterly Journal of Economics, 115, 847–904.
View in Google Scholar DOI: https://doi.org/10.1162/003355300554935

Andini, C., & Andini, M. (2019). Social capital and growth: Causal evidence from Italian municipalities. Journal of Economic Geography, 19(3), 619–653.
View in Google Scholar DOI: https://doi.org/10.1093/jeg/lby024

Becker, G. S. (2009). Human capital: A theoretical and empirical analysis, with special reference to education. University of Chicago Press.
View in Google Scholar

Benabou, R. (1994). Human capital, inequality, and growth: A local perspective. European Economic Review, 38(3–4), 817–826.
View in Google Scholar DOI: https://doi.org/10.1016/0014-2921(94)90118-X

Beugelsdijk, S., & Van Schaik, T. (2005). Differences in social capital between 54 Western European regions. Regional Studies, 39(8), 1053–1064.
View in Google Scholar DOI: https://doi.org/10.1080/00343400500328040

Botzen, K. (2016). Social capital and economic well-being in Germany’s regions: An exploratory spatial analysis. Region, 3(1), 1–24.
View in Google Scholar DOI: https://doi.org/10.18335/region.v3i1.73

Bourdieu, P. (1986). The forms of capital. In J. Richardson (Ed.), Handbook of theory and research for the sociology of education (pp. 241–258). Greenwood.
View in Google Scholar

Breusch, T. S., & Pagan, A.R. (1980). The Lagrange multiplier test and its applications to model specification in econometrics. The Review of Economic Studies, 47(1), 239–253.
View in Google Scholar DOI: https://doi.org/10.2307/2297111

Calcagnini, G., & Perugini, F. (2019). Social capital and well-being in the Italian provinces. Socio-Economic Planning Sciences, 68, 100668.
View in Google Scholar DOI: https://doi.org/10.1016/j.seps.2018.11.005

Casey, T., & Christ, K. (2005). Social capital and economic performance in the American states. Social Science Quarterly, 86(4), 826–845.
View in Google Scholar DOI: https://doi.org/10.1111/j.0038-4941.2005.00358.x

Coleman, J. S. (1990). Foundations of social theory. Harvard University Press.
View in Google Scholar

Coleman, J. S. (1994). Social capital, human capital, and investment in youth. In A. C. Petersen & J. T. Mortimer (Eds.), Youth unemployment and society (pp. 34–50). Cambridge University Press. https://doi.org/10.1017/CBO9780511664021.004
View in Google Scholar DOI: https://doi.org/10.1017/CBO9780511664021.004

Davaadorj, Z. (2019). Does social capital affect dividend policy? Journal of Behavioral and Experimental Finance, 22, 116–128.
View in Google Scholar DOI: https://doi.org/10.1016/j.jbef.2019.02.010

Dearmon, J., & Grier, K. (2009). Trust and development. Journal of Economic Behavior & Organization, 71(2), 210–220.
View in Google Scholar DOI: https://doi.org/10.1016/j.jebo.2009.02.011

Delhey, J., Newton, K., & Welzel, C. (2011). How general is trust in ‘‘Most People’’? Solving the radius of trust problem. American Sociological Review, 76(5), 786–807.
View in Google Scholar DOI: https://doi.org/10.1177/0003122411420817

Dumitrescu, E. I., & Hurlin, C. (2012). Testing for Granger non-causality in heterogeneous panels. Economic Modelling, 29(4), 1450–1460.
View in Google Scholar DOI: https://doi.org/10.1016/j.econmod.2012.02.014

Edvinsson, L., & Stenfelt, C. (1999). Intellectual capital of nations—for future wealth creation. Journal of Human Resource Costing and Accounting, 4(1), 21–33.
View in Google Scholar DOI: https://doi.org/10.1108/eb029051

Emirmahmutoglu, F., & Kose, N. (2011). Testing for Granger causality in heterogene-ous mixed panels. Economic Modelling, 28(3), 870–876.
View in Google Scholar DOI: https://doi.org/10.1016/j.econmod.2010.10.018

Feki, C., & N. Chtourou (2014). Social capital & economic growth: Empirical analysis of panel data. International Journal of Innovation and Scientific Research, 2(1), 164–176.
View in Google Scholar

Fischer, J. A., & Torgler, B. (2006). The effect of relative income position on social capital. Economics Bulletin, 26(4), 1–20.
View in Google Scholar

Fukuyama, F. (1995). Trust: The social virtues and the creation of prosperity. Free Press.
View in Google Scholar

Gambetta, D. (1996). The Sicilian mafia: The business of private protection. Harvard University Press.
View in Google Scholar

Guiso, L., Sapienza, P., & Zingales, L. (2004). The role of social capital in financial development. The American Economic Review, 94(3), 526–556.
View in Google Scholar DOI: https://doi.org/10.1257/0002828041464498

Hall, S. G., & Ahmad, M. (2013). Can trust explain social capital effect on property rights and growth? Procedia Economics & Finance, 7, 55–64.
View in Google Scholar DOI: https://doi.org/10.1016/S2212-5671(13)00218-9

Hanifan, L. (1916). The rural school community center. Annals of the American Academy of Political and Social Science, 67, 130–138.
View in Google Scholar DOI: https://doi.org/10.1177/000271621606700118

Hasan, I., Hoi, C. K., Wu, Q., & Zhang, H. (2017). Social capital and debt contracting: Evidence from bank loans & public bonds. Journal of Financial and Quantitative Ananysis, 53, 1017–1047.
View in Google Scholar DOI: https://doi.org/10.1017/S0022109017000205

Hasanov, F. J., Khan, Z., Hussain, M., & Tufail, M. (2021). Theoretical framework for the carbon emissions effects of technological progress and renewable energy consumption. Sustainable Development, 29(5), 810–822.
View in Google Scholar DOI: https://doi.org/10.1002/sd.2175

Helliwell, J. F. (1996). Economic growth and social capital in Asia. NBER Working Paper, 5470. National Bureau of Economic Research.
View in Google Scholar DOI: https://doi.org/10.3386/w5470

Helliwell, J. F. (2007). Well-being and social capital: Does suicide pose a puzzle?. Social Indicators Research, 81(3), 455–496.
View in Google Scholar DOI: https://doi.org/10.1007/s11205-006-0022-y

Hjerppe, R. (1998). Social capital and economic growth. VATT Discussion Papers183, 1–26. Government Institute for Economic Research. Helsinki.
View in Google Scholar

Iyer, S., Kitson, M., & Toh, B. (2005). Social capital, economic growth and regional development. Regional Studies, 39(8), 1015–1040.
View in Google Scholar DOI: https://doi.org/10.1080/00343400500327943

Jha, A., & Chen, Y. (2015). Audit fees and social capital. The Accounting Review, 90, 611–639.
View in Google Scholar DOI: https://doi.org/10.2308/accr-50878

Jin, J. Y., Kanagaretnam, K., Liu, Y., & Liu, N. (2019). Banks’ loan growth, loan quality and social capital. Journal of Behavioral and Experimental Finance, 21, 83–10.
View in Google Scholar DOI: https://doi.org/10.1016/j.jbef.2018.11.004

Juhro, S. M., Narayan, P. K., Iyke, B. N., & Trisnanto, B. (2022). Social capital, R&D and provincial growth in Indonesia. Regional Studies, 56(12), 2117–2132.
View in Google Scholar DOI: https://doi.org/10.1080/00343404.2022.2042469

Knack, S. (2003). Groups, growth & trust: Cross-country evidence on the Olson and Putnam hypothesis. Public Choice, 117(3–4), 341–355.
View in Google Scholar DOI: https://doi.org/10.1023/B:PUCH.0000003736.82456.04

Knack, S., & Keefer, P. (1997). Does social capital have an economic payoff? A cross-country investigation. The Quarterly Journal of Economics, 112(4), 1251–1288.
View in Google Scholar DOI: https://doi.org/10.1162/003355300555475

Koç, A., & Ata, Y. (2012). Sosyal sermaye ve ekonomik büyüme ilişkisi: AB ülkeleri ve Türkiye üzerine ampirik bir inceleme. Süleyman Demirel Üniversitesi İktisadi ve İdari Bilimler Fakültesi Dergisi, 17(1), 199–218.
View in Google Scholar

Li, Y., Wung, X., Westlund, H., & Liu, Y. (2015). Physical capital, human capital and social capital: The changing roles in China’s economic growth. Growth and Change, 46(1), 133–149.
View in Google Scholar DOI: https://doi.org/10.1111/grow.12084

Lucas, R. E., Jr. (2015). Human capital and growth. American Economic Review, 105(5), 85–88.
View in Google Scholar DOI: https://doi.org/10.1257/aer.p20151065

Menyah, K., Nazlioglu, S., & Wolde-Rufael, Y. (2014). Financial development, trade openness and economic growth in African countries: New insights from a panel causality approach. Economic Modelling, 37, 386–394.
View in Google Scholar DOI: https://doi.org/10.1016/j.econmod.2013.11.044

Muringani, J., Fitjar, R. D., & Rodríguez-Pose, A. (2021). Social capital and economic growth in the regions of Europe. Environment and Planning A: Economy and Space, 53(6), 1412–1434.
View in Google Scholar DOI: https://doi.org/10.1177/0308518X211000059

Neira, I., Vászquez, E., & Portela, M. (2009). An empirical analysis of social capital and economic growth in Europe (1980–2000). Social Indicators Research, 92(1), 111–129.
View in Google Scholar DOI: https://doi.org/10.1007/s11205-008-9292-x

North, D.C. (1990). Institutions, institutional change and economic performance. Cambridge University Press.
View in Google Scholar DOI: https://doi.org/10.1017/CBO9780511808678

Özcan, B., & Zeren, F. (2013). Sosyal güven ve ekonomik kalkınma: Avrupa ülkeleri üzerine mekansal ekonometri analizi. Eskişehir Osmangazi Üniversitesi İktisadi İdari Bilimler Fakültesi Dergisi, 8(1), 7–36.
View in Google Scholar

Peiró-Palomino, J., & Tortosa-Ausina, E. (2015). Social capital, investment and economic growth: Some evidence for Spanish provinces. Spatial Economic Analysis, 10(1), 102–126.
View in Google Scholar DOI: https://doi.org/10.1080/17421772.2014.899387

Pan, F., & He, C. (2010). Regional difference in social capital and its impact on regional economic growth in China. Chinese Geographical Science, 20, 442–449.
View in Google Scholar DOI: https://doi.org/10.1007/s11769-010-0418-0

Parts, E. (2013). The dynamics and determinants of social capital in the European Union and neighbouring countries. Discussions on Estonian economic policy: Theory and practice of economic policy in the European Union, 1. https://doi.org/10.2139/ssrn.2336016
View in Google Scholar DOI: https://doi.org/10.2139/ssrn.2336016

Pennar, K. (1997, December 15). The tie that leads to prosperity: The economic value of social bonds is only beginning to be measured. Business Weekly, 153–155.
View in Google Scholar DOI: https://doi.org/10.2307/1392302

Perez, F., Fernandez de Guevara, J., Serrano, L., & Montesinos, V. (2006). Measurement of social capital & growth: An economic methodology. Fundacion BBWA, 1–57.
View in Google Scholar

Pesaran, M. H. (2004, August). General diagnostic tests for cross section dependence in panels. IZA Discussion Paper, 1240, 1–39.
View in Google Scholar DOI: https://doi.org/10.2139/ssrn.572504

Pesaran, M. H. (2007). A simple panel unit root test in the presence of cross‐section dependence. Journal of Applied Econometrics, 22(2), 265–312.
View in Google Scholar DOI: https://doi.org/10.1002/jae.951

Pesaran, M. H., & Yamagata, T. (2008). Testing slope homogeneity in large panels. Journal of Econometrics, 142(1), 50–93.
View in Google Scholar DOI: https://doi.org/10.1016/j.jeconom.2007.05.010

Phillips, P. C., & Sul, D. (2003). Dynamic panel estimation and homogeneity testing under cross section dependence. The Econometrics Journal, 6(1), 217–259.
View in Google Scholar DOI: https://doi.org/10.1111/1368-423X.00108

Pilatin, A. (2022). Impact of social capital on economic growth: A meta-analysis. International Journal of Economics, Business & Politics, 6(2), 216–235. https://doi.org/10.29216/ueip.1132292
View in Google Scholar DOI: https://doi.org/10.29216/ueip.1132292

Pilatin, A., & Ayaydın, H. (2022a). Social capital measurement in Türkiye: Creating an index by province. Journal of Economy Culture & Society, 66, 235–259. https://doi.org/10.26650/JECS2021-1033478
View in Google Scholar DOI: https://doi.org/10.26650/JECS2021-1033478

Pilatin, A., & Ayaydin, H. (2022b). The relationship between banks’ credit quality, credit growth and social capital: Evidence from Turkish banking sector. Middle East Development Journal, 14(1), 133–170. https://doi.org/10.1080/17938120. 2022.2074673
View in Google Scholar DOI: https://doi.org/10.1080/17938120.2022.2074673

Portes, A. (1998). Social capital: Its origins and the application in modern sociology. Annual Review of Sociology, 24(1), 1–25.
View in Google Scholar DOI: https://doi.org/10.1146/annurev.soc.24.1.1

Postelnicu, L., & Hermes, N. (2018). The economic value of social capital. International Journal of Social Economics, 45(6), 870–887.
View in Google Scholar DOI: https://doi.org/10.1108/IJSE-03-2017-0104

Putnam, R. D. (1993). Making democracy work. Civic traditions in modern Italy. Princeton University Press.
View in Google Scholar DOI: https://doi.org/10.1515/9781400820740

Putnam, R. D. (1995). Bowling alone: America’s declining social capital. Journal of Democracy, 6(1), 65–78.
View in Google Scholar DOI: https://doi.org/10.1353/jod.1995.0002

Putnam, R. D. (2007). E pluribus unum: Diversity and community in the twenty‐first century the 2006 Johan Skytte Prize Lecture. Scandinavian Political Studies, 30(2), 137–174.
View in Google Scholar DOI: https://doi.org/10.1111/j.1467-9477.2007.00176.x

Romer, P. M. (1986). Increasing returns and long-run growth. The Journal of Political Economy, 95(5), 1002–1037.
View in Google Scholar DOI: https://doi.org/10.1086/261420

Romer, P. M. (1990). Human capital and growth: Theory and evidence. Carnegie-Rochester Conference Series on Public Policy, 32, 251–286.
View in Google Scholar DOI: https://doi.org/10.1016/0167-2231(90)90028-J

Roth, F. (2007). Trust & economic growth: Conflicting results between cross-sectional and panel analysis. Ratio Working Paper, 102. https://www.ratio.se/pdf/wp/fr_trust.pdf
View in Google Scholar

Roth, F. & Schüler, D. (2006). Trust and economic growth: A panel analysis. Manuscript Draft: University of Göttingen.
View in Google Scholar

Routledge, B. R, & von Amsberg, J. (2003). Social capital and growth. Journal of Monetary Economics, 50, 167–193.
View in Google Scholar DOI: https://doi.org/10.1016/S0304-3932(02)00210-6

Rupasingha, A., & Goetz, S. J. (2008). US county-level social capital data, 1990–2005. The Northeast Regional Center for Rural Development, Penn State University.
View in Google Scholar

Rupasingha, A., Goetz, S. J., & Freshwater, D. (2000). Social capital and economic growth: A countylevel analysis. Journal of Agricultural and Applied Economics, 32(3), 565–572.
View in Google Scholar DOI: https://doi.org/10.1017/S1074070800020654

Rupasingha, A, Goetz, S. J., & Freshwater, D. (2006). The production of social capital in US counties. Journal of Socio-Economics, 35, 83–101.
View in Google Scholar DOI: https://doi.org/10.1016/j.socec.2005.11.001

Solow, R. M. (1956). A contribution to the theory of economic growth. Quarterly Journal of Economics, 70, 65–94.
View in Google Scholar DOI: https://doi.org/10.2307/1884513

Stewart, T. (1997). Intellectual capital: The new wealth of organizations. Currency Doubleday.
View in Google Scholar

Sveiby, K. E. (2000). Measuring intangibles and intellectual capital. The MIT Press.
View in Google Scholar DOI: https://doi.org/10.7551/mitpress/4075.003.0028

Swan, T. W. (1956, November). Economic growth and capital accumulation. Economic Record, 32, 334–361.
View in Google Scholar DOI: https://doi.org/10.1111/j.1475-4932.1956.tb00434.x

Tomer, J. F. (2011, October 1). Improving the standard of living through investments in intangible capital. https://doi.org/10.2139/ssrn.1991256
View in Google Scholar DOI: https://doi.org/10.2139/ssrn.1991256

TUIK. (2022). https://data.tuik.gov.tr/Bulten/Index?p=Donemsel-Gayrisafi-Yurt-Ici-Hasila-IV.-Ceyrek:-Ekim-Aralik-2021-45548
View in Google Scholar

Wang, P., Chen, X., Gong, J., & Jacques-Tiura, A. J. (2014). Reliability & validity of the personal social capital scale 16 & personal social capital scale 8: Two short instruments for survey studies. Social Indicators Research, 119(2), 1133–1148.
View in Google Scholar DOI: https://doi.org/10.1007/s11205-013-0540-3

Westlund, H., & Adam, F. (2010). Social capital and economic performance: A meta analysis of 65 Studies. European Planning Studies, 18(6), 893–919.
View in Google Scholar DOI: https://doi.org/10.1080/09654311003701431

Wong, S. (2013). From economic meltdown to social crunch: Lessons about social capital and economic crises. Procedia-Social and Behavioral Sciences, 72, 107–119.
View in Google Scholar DOI: https://doi.org/10.1016/j.sbspro.2013.02.009

Woolcock, M. (1998). Social capital and economic development: Toward a theoretical synthesis and policy framework. Theory and Society, 27, 151–208.
View in Google Scholar DOI: https://doi.org/10.1023/A:1006884930135

World Bank. (2011). What is social capital? www.worldbank.org
View in Google Scholar

Issue 3/2023 cover

Downloads

Published

2023-08-28 — Updated on 2023-10-12

Versions

Issue

Vol. 9 No. 3 (2023)

Section

Research article- regular issue

License

Copyright (c) 2023 Abdulmuttalip Pilatin , Tunahan Hacıimamoğlu

Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

How to Cite

Pilatin, A., & Hacıimamoğlu, T. (2023). The relationship between social capital and economic growth on a provincial and regional basis. Economics and Business Review, 9(3). https://doi.org/10.18559/ebr.2023.3.799 (Original work published 2023)

Similar Articles

51-60 of 319

You may also start an advanced similarity search for this article.