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The Missing Link: Are Individuals with More Social Capital in Better Health? Evidence from India

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Abstract

This paper extends a two-period overlapping generations model of endogenous growth in which associations between human capital, social capital, and health outcomes are critically examined for a low income country, India. If individuals with higher levels of human capital can build strong social ties and have more robust social networks, they are then less likely to have health problems and are therefore physically healthier. In an attempt to test the so-called relationship between the variables in question, a unique dataset, where micro-level data from the world values survey and regional-level macro data from the central statistics office of India were both utilised, was accessed. A three-equation model has been then estimated using the conditional mixed-process method in order to address endogeneity issues explicitly. Our estimation results provide important insights into the theoretical thesis in several ways. Firstly, human capital has a favourable impact on social capital, which in turn enhances self-reported health. Secondly, we provide a comparison of three main experiments: an increase in the share of public spending by region on education, social capital-enhancing activities, and health. The results confirm the positive effect of an increase in each form of government spending on outcome variables. Thirdly, the correlation coefficient between disturbances of these three equations turns out to be statistically significant, suggesting that there are unobserved factors, which can affect self-reported health, social capital and human capital variables.

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Notes

  1. See, for instance, Grossman (1972), Rosenzweig and Paul Schultz (1983), Grossman and Kaestner (1997), Grossman (2000), Grossman (2005), Goldman and Smith (2005), Arendt (2005), Lleras-Muney (2005), Tamura (2006), Grimard and Parent (2007), De Walque (2007), Albouy and Lequien (2009), Cutler and Lleras-Muney (2010), Webbink et al. (2010), Agénor (2012), and Clark and Royer (2013), among others.

  2. In addition to these variables, Agénor and Dinh (2015) also considered the stock of imitated goods, as well as a fixed fraction of time spent in schooling to account for the human capital stock of individuals; however, we have abstracted from these issues.

  3. See, for instance, Scrivens and Smith (2013) for further discussion.

  4. See, for instance, Agénor (2012) for further discussion.

  5. See Bloom and Canning (2005), and Cole and Neumeyer (2006) for further discussion.

  6. Inglehart, R., C. Haerpfer, A. Moreno, C. Welzel, K. Kizilova, J. Diez-Medrano, M. Lagos, P. Norris, E. Ponarin & B. Puranen et al. (eds.). 2014. World Values Survey: Round Six - Country-Pooled Datafile Version: http://www.worldvaluessurvey.org/WVSDocumentationWV6.jsp. Madrid: JD Systems Institute.

  7. This type of government expenditure is listed under non-developmental expenditure and its components are as follows: secretariat-general services, district administration, police, public works, and others.

  8. The components of government spending on social services are family welfare, water supply and sanitation, housing, urban development, welfare of scheduled castes, scheduled tribes and other backward classes, labour and labour welfare, social security and welfare, nutrition, and relief on account of natural calamities, respectively.

  9. Agriculture and allied activities, rural development, special area programmes, irrigation and flood control, energy, industry and minerals, transport and communications, science, technology and environment as well as general economic services are the components of government spending on economic services.

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Authors and Affiliations

  1. Department of Economics, Social Sciences University of Ankara, Ankara, Turkey

    Barış Alpaslan

  2. Centre for Applied Macroeconomic Analysis (CAMA), Crawford School of Public Policy, Australian National University, Canberra, Australia

    Barış Alpaslan

  3. The Sheffield Institute for International Development (SIID), University of Sheffield, Sheffield, UK

    Barış Alpaslan

  4. Economic Research Forum (ERF), Cairo, Egypt

    Barış Alpaslan

  5. Department of Economics, TED University, Ankara, Turkey

    Julide Yildirim

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  1. Barış Alpaslan
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This paper was previously titled “The Missing Link: Are Individuals with More Social Capital in Better Health? Evidence from Low-Income Countries”. We are grateful to two anonymous reviewers and the Editor for helpful comments and discussions.

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Table 6 Data definition and source
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Alpaslan, B., Yildirim, J. The Missing Link: Are Individuals with More Social Capital in Better Health? Evidence from India. Soc Indic Res 150, 811–834 (2020). https://doi.org/10.1007/s11205-020-02343-6

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