This paper aims to analyze the relationship between the various dimensions of social capital and subjective wellbeing. Data used in this study come from the fourth wave of the European Social Survey and different measures of wellbeing are used to take account of both the cognitive and affective processes of individual wellbeing (i.e. life satisfaction, happiness, and subjective wellbeing). A factor analysis is performed to summarize information coming from a large set of variables into different components corresponding to each dimension of social capital (i.e. networks, norms, and trust). Among the results, we find that the impact of social capital on subjective wellbeing differ depending on the component of social capital which is under analysis. In particular, social networks, social trust and institutional trust are the components that show a higher correlation with subjective wellbeing. Furthermore, in addition to the positive effects of the individual variables, our results suggest that social capital at the aggregate level positively correlates with individual wellbeing, thus pointing to an external or environmental effect of social capital.
This is a preview of subscription content, access via your institution.
Buy single article
Instant access to the full article PDF.
Tax calculation will be finalised during checkout.
Although acknowledging differences between these concepts, the words happiness, life satisfaction and subjective wellbeing are often used as interchangeable in the economic literature (Frey and Stutzer 2002a). It is worth noting, however, that satisfaction with life is a component of subjective wellbeing, which in turn is generally seen as involving both cognitive and affective processes (Diener 1984; Veenhoven 1994; Diener et al. 2003).
Some exceptions are, among others, the works by Bjørnskov (2006, 2008), who consider three different components corresponding to social trust, social norms and associational activity in an empirical study at the macro level; or Sarracino (2010), who considers four set of proxies and distinguishes between intrinsically and extrinsically motivated group participation.
For detailed information on the ESS and on collected data, see http://www.europeansocialsurvey.org.
Prior to this analysis, a categorical principal component analysis has been performed given the ordinal and nominal nature of the variables. We then follow the procedure shown in this paper with the transformed variables coming from this preliminary analysis. This procedure is also adopted for the social norms dimension and for the global analysis presented henceforth.
The statistical summary of the variables used in this study is provided in the “Appendix”.
It is noteworthy that problems of endogeneity and reversed causality may be present in works based on cross-sectional survey data (for some methodological cautions in this literature see, for example, Helliwell and Putnam 2004). Although this can be the case regarding variables such as subjective health or social capital, different studies suggest that the causal relationship goes from these variables to subjective wellbeing (Graham 2008; Dolan et al. 2008). In any case, it should be noted that our focus is on correlations with subjective wellbeing and not on causality.
We thank an anonimous referee for discussion on this point.
Argyle, M. (1999). Causes and correlates of happiness. In D. Kahneman, E. Diener & N. Schwarz (Eds), Well-being. The foundations of hedonic psychology. New York: Russell Sage Foundation.
Bartolini, S., Bilancini, E., & Pugno, M. (2008). Did the decline in social capital decrease American happiness? A relational explanation of the happiness paradox. University of Siena Department of Economics working paper 513.
Bartolini, S., & Bonatti, L. (2003). Endogenous growth and negative externalities. Journal of Economics, 79, 123–144.
Becchetti, L., Pelloni, A., & Rossetti, F. (2008). Relational goods, sociability, and happiness. Kyklos, 61, 343–363.
Bjørnskov, C. (2003). The happy few: Cross-country evidence on social capital and life satisfaction. Kyklos, 56, 3–16.
Bjørnskov, C. (2006). The multiple facets of social capital. European Journal of Political Economy, 22, 22–40.
Bjørnskov, C. (2008). Social capital and happiness in the United States. Applied Research Quality Life, 3, 43–62.
Bourdieu, P. (1986). The forms of capital. In J. Richardson (Ed.), Handbook of theory and research for the sociology of education. New Cork: Greenwood Press.
Bruni, L., & Stanca, L. (2008). Watching alone: Relational goods, television and happiness. Journal of Economic Behavior & Organization, 63, 506–528.
Clark, A., Frijters, P., & Shields, M. (2008). Relative income, happiness, and utility: An explanation for the Easterlin paradox and other puzzles. Journal of Economic Literature, 46(1), 95–144.
Coleman, J. (1990). Foundations of social theory. Cambridge, MA: Belknap Press of Harvard University Press.
Costa, D., & Kahn, M. (2003). Understanding the American decline in social capital, 1952–1998. Kyklos, 56, 17–46.
Deci, E. L., & Ryan, R. M. (1991). A motivational approach to self: Integration in personality. In R. Dienstbier (Ed.), Nebraska symposium on motivation: Perspectives on motivation. Lincoln: University of Nebraska Press.
Di Tella, R., McCulloch, R. J., & Oswald, A. J. (2003). The macroeconomics of happiness. Review of Economics and Statistics, 85, 809–827.
Diener, E. (1984). Subjective well-being. Psychological Bulletin, 95, 542–575.
Diener, E., Oishi, S., & Lucas, R. E. (2003). Personality, culture, and subjective well-being: Emotional and cognitive evaluations of life. Annual Review of Psychology, 54, 403–425.
Diener, E., Suh, E. M., Lucas, R. E., & Smith, H. I. (1999). Subjective well-being: Three decade of progress. Psychological Bulletin, 125, 276–302.
Dolan, P., Peasgood, T., & White, M. (2008). Do we really know what makes us happy: A review of the economic literature on the factors associated with subjective well-being. Journal of Economic Psychology, 29, 94–122.
Durlauf, S. N. (2002). On the empirics of social capital. The Economic Journal, 112, 459–479.
Easterlin, R. (1974). Does economic growth improve the human a lot? Some empirical evidence. In P. A. David & M. W. Reder (Eds.), Nations and households in economic growth: Essays in honor of Moses Abramovitz. New York: Academic Press.
Frey, B., & Stutzer, A. (2002a). What can economists learn from happiness research? Journal of Economic literature, 40, 402–435.
Frey, B., & Stutzer, A. (2002b). Happiness and economics. How the economy and institutions affect human well-being. Princenton: Princenton University Press.
Graham, C. (2008). Happiness and health: Lessons -and questions- for public policy. Health Affairs, 27, 72–87.
Gui, B., & Sugden, R. (Eds.). (2005). Economics and social interaction. Cambridge: Cambridge University Press.
Gui, B., & Stanca, L. (2010). Happiness and relational goods: well-being and interpersonal relations in the economic sphere. International Review of Economics, 57, 105–118.
Helliwell, J. F. (2003). How’s life? Combining individual and national variables to explain subjective well-being. Economic Modelling, 20, 331–360.
Helliwell, J. F. (2006). Well-being, social capital and public policy: What’s new? The Economic Journal, 116, 34–45.
Helliwell, J. F., & Putnam, R. D. (1995). Economic growth and social capital in Italy. Eastern Economic Journal, 21, 295–307.
Helliwell, J. F., & Putnam, R. D. (2004). The social context of well-being. Philosophical Transactions of the Royal Society B, 359, 1435–1446.
Inglehart, R., & Klingemann, H. D. (2000). Genes, culture, democracy, and happiness. In E. Diener & E. M. Suh (Eds.), Culture and subjective well-being. Cambridge: MIT Press.
Kahneman, D., Diener, E., & Schwarz, N. (Eds.). (1999). Well-Being: The foundations of hedonic psychology. New Cork: Russel Sage Foundation.
Klein, C. (2011). Social capital or social cohesion: What matters for subjective well-being (SWB)? EPS/INSTEAD working paper 2011–2036.
Olson, M. (1982). The rise and decline of nations: Economic growth, stagflation and social rigidities. New Haven: Yale University Press.
Paxton, P. (1999). Is social capital declining in the United States? A multiple indicator assessment. American Journal of Sociology, 105, 88–127.
Pugno, M. (2009). The Easterlin paradox and the decline of social capital: An integrated explanation. The Journal of Socio-Economics, 38, 590–600.
Putnam, R. D. (1993). Making democracy work: Civic traditions in modern Italy. Princeton, NJ: Princeton University Press.
Putnam, R. D. (2000). Bowling alone. New Cork: Simon & Schuster.
Rojas, M. (2007). Heterogeneity in the relationship between income and happiness: A conceptual-referent-theory explanation. Journal of Economic Psychology, 28, 1–14.
Rothstein, B. (2001). Social capital in the social democratic welfare state. Politics and Society, 29, 207–241.
Salinas-Jiménez, M. M., Artés, J., & Salinas-Jiménez, J. (2010). Income, motivation, and satisfaction with life: An empirical analysis. Journal of Happiness Studies, 11, 779–793.
Sarracino, F. (2010). Social capital and subjective well-being trends: Comparing 11 western European countries. The Journal of Socio-Economics, 39, 482–517.
Stevenson, B., & Wolfers, J. (2008). Economic growth and subjective well-being: Reassessing the Easterlin paradox. Brookings papers on economic activity.
Stolle, D., & Hooghe, M. (2004). Inaccurate, exceptional, one-sided or irrelevant? The debate about the alleged decline of social capital and civic engagement in Western societies. British Journal of Political Science, 35, 149–167.
Stolle, D., & Rochon, T. R. (1998). Are all associations alike? The American Behavioral Scientist, 42, 47–65.
Svendsen, G. T., & Bjornskov, C. (2007). How to construct a robust measure of social capital: Two contributions. Journal of Comparative Policy Analysis, 9, 275–292.
Uhlaner, C. J. (1989). ‘Relational goods’ and participation: Incorporating sociability into theory of rational action. Public Choice, 62, 253–285.
Uslaner, E. M. (1999). Democracy and social capital. In M. E. Warren (Ed.), Democracy and trust. New York: Cambridge University Press.
Uslaner, E. M. (2002). The moral foundations of trust. Cambridge, UK: Cambridge University Press.
van Oorschot, W., & Arts, W. (2005). The social capital of European welfare states: The crowding out hypothesis revisited. Journal of European Social Policy, 15, 5–26.
Veenhoven, R. (1994). El Estudio de la satisfacción con la vida. Intervención Psicosocial, 3, 87–116.
About this article
Cite this article
Portela, M., Neira, I. & Salinas-Jiménez, M.M. Social Capital and Subjective Wellbeing in Europe: A New Approach on Social Capital. Soc Indic Res 114, 493–511 (2013). https://doi.org/10.1007/s11205-012-0158-x
- Social capital
- Factor analysis