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FROM SOCIAL CAPITAL TO HEALTH – AND BACK
Author(s) -
Rocco Lorenzo,
Fumagalli Elena,
Suhrcke Marc
Publication year - 2014
Publication title -
health economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.55
H-Index - 109
eISSN - 1099-1050
pISSN - 1057-9230
DOI - 10.1002/hec.2934
Subject(s) - endogeneity , social capital , european social survey , causation , simultaneous equations model , economics , capital (architecture) , structural equation modeling , demographic economics , econometrics , public economics , sociology , political science , geography , statistics , social science , mathematics , archaeology , politics , law
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 inter‐relationship is tested using data from the first four waves of the European Social Survey for 25 European countries, supplemented by regional data from Eurostat. Our estimates show that a causal and positive relationship between self‐perceived 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, whereas community level social capital plays a considerably smaller role in determining health. Copyright © 2013 John Wiley & Sons, Ltd.