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.
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.
Subscribe to journal
Immediate online access to all issues from 2019. Subscription will auto renew annually.
Tax calculation will be finalised during checkout.
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.
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.
See, for instance, Scrivens and Smith (2013) for further discussion.
See, for instance, Agénor (2012) for further discussion.
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.
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.
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.
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.
Agénor, P.-R. (2012). Public capital, growth and welfare. Princeton, NJ: Princeton University Press.
Agénor, P.-R., & Canuto, O. (2015). Gender equality and economic growth in Brazil: A long-run analysis. Journal of Macroeconomics, 43, 155–172.
Agénor, P.-R., Canuto, O., & Pereira da Silva, L. (2014). On gender and growth: The role of intergenerational health externalities and women’s occupational constraints. Structural Change and Economic Dynamics, 30, 132–147.
Agénor, P.-R., & Dinh, H. T. (2015). Social capital, product imitation and growth with learning externalities. Journal of Development Economics, 114, 41–54.
Albouy, V., & Lequien, L. (2009). Does compulsory education lower mortality? Journal of Health Economics, 28, 155–168.
Alpaslan, B. (2017). Are human and social capital linked? Evidence from India. Metroeconomica, 68, 859–881.
Arendt, J. N. (2005). Does education cause better health? A panel data analysis using school reforms for identification. Economics of Education Review, 24, 149–160.
Baru, R., Acharya, A., Sanghmitra Acharya, A. K., Kumar, S., & Nagaraj, K. (2010). Inequities in access to health services in India. Economic and Political Weekly: Caste, Class and Region, 45, 49–58.
Beatrice, H., Rocco, L., Suhrcke, M., & McKee, M. (2010). Does social capital determine health? Evidence from eight transition countries. Health Economics, 19, 56–74.
Berkman, L. F., & Syme, L. (1979). Social networks, host resistance, and mortality: A nine-year follow-up study of Alameda county residents. American Journal of Epidemiology, 109, 186–204.
Bloom, D. E., & Canning, D. (2005). Schooling, health, and economic growth: Reconciling the micro and macro evidence. Harvard School of Public Health (unpublished).
Bofota, Y. B., Boucekkine, R., & Bala, A. P. (2016). Social capital as an engine of growth: Multisectoral modelling and implications. Macroeconomic Dynamics, 20, 2093–2122.
Bourdieu, P. (1986). The forms of capital. In J. E. Richardson (Ed.), Handbook of theory of research for the sociology of education. New York: Greenwood.
Charron, N., & Rothstein, B. (2016). Does education lead to higher generalized trust? The importance of quality of government. International Journal of Educational Development, 50, 59–73.
Chou, Y. K. (2006). Three simple models of social capital and economic growth. Journal of Socio-Economics, 35, 889–912.
Clark, D., & Royer, H. (2013). The effect of education on adult health and mortality: Evidence from Britain. American Economic Review, 103, 2087–2120.
Coleman, J. S. (1988). Social capital in the creation of human capital. American Journal of Sociology, 94, 95–120.
Coleman, J. S. (1990). The foundations of social theory. Cambridge: Harvard University Press.
Cole, M. A., & Neumeyer, E. (2006). The impact of poor health on total factor productivity. Journal of Development Studies, 42, 918–938.
Cutler, D. M., & Lleras-Muney, A. (2010). Understanding differences in health behaviours by education. Journal of Health Economics, 29, 1–28.
Dasgupta, P. (2003). Social capital and economic performance: Analytics. In E. Ostrom & T. K. Ahn (Eds.), Foundations of social capital. Cheltenham: Edward Elgar.
De Walque, D. (2007). Does education affect smoking behaviors? Evidence using the vietnam draft as an instrument for college education. Journal of Health Economics, 26, 877–895.
Durlauf, S. N., & Fafchamps, M. (2005). Social capital. In P. Aghion & S. N. Durlauf (Eds.), Handbook of economic growth. Amsterdam: North Holland.
Eng, P. M., Rimm, E. B., Fitzmaurice, G., & Kawachi, I. (2002). Social ties and change in social ties in relation to subsequent total and cause-specific mortality and coronary heart disease incidence in men. American Journal of Epidemiology, 155, 700–709.
Ferlander, S. (2007). The importance of different forms of social capital for health. Acta Sociologica, 50, 115–128.
Fiorillo, D., & Sabatini, F. (2015). Structural social capital and health in Italy. Economics and Human Biology, 17, 129–142.
Fukuyama, F. (1995). Trust: The social virtues and the creation of prosperity. New York: The Free Press.
Gladwell, M. (2008). Outliers: The story of success. New York: Little Brown and Company.
Glaeser, E. L., Laibson, D., & Sacerdote, B. (2002). An economic approach to social capital. The Economic Journal, 112, 437–458.
Goldman, D., & Smith, J. P. (2005). Socioeconomic differences in the adoption of new medical technologies. American Economic Review, 95, 234–237.
Grimard, F., & Parent, D. (2007). Education and smoking: Were vietnam draft avoiders also more likely to avoid smoking? Journal of Health Economics, 26(2007), 896–926.
Grossman, M. (1972). On the concept of health capital and the demand for health. Journal of Political Economy, 80, 223–255.
Grossman, M. (2000). The human capital model. In A. Culyer & P. Newhouse (Eds.), Handbook of health economics. Amsterdam: North Holland.
Grossman, M. (2005). Education and non market outcomes. In E. Hanushek & F. Welch (Eds.), Handbook of the economics of education. Amsterdam: North Holland.
Grossman, M., & Kaestner, R. (1997). Effects of education on health. In J. R. Behrman & N. Stacey (Eds.), The social benefits of education. Ann Arbor: University of Michigan Press.
Growiec, K., & Growiec, J. (2012). Social capital, trust, and multiple equilibria in economic performance. Institute for Structural Research (unpublished).
Guiso, L., Sapienza, P., & Zingales, L. (2009). Cultural biases in economic exchange? The Quarterly Journal of Economics, 124, 1095–1131.
Hanifan, L. J. (1916). The rural school community center. Annals of the American Academy of Political and Social Science, 67, 130–138.
Harpham, T., Grant, E., & Rodriguez, C. (2004). Mental health and social capital in Cali, Colombia. Social Science and Medicine, 58, 2267–2277.
Helliwell, J. F., Aknin, L. B., Shiplett, H., Huang, H., Wang, S. (2017). Social capital and prosocial behaviour as sources of well-being. NBER Working Paper No. 23761, National Bureau of Economic Research.
Helliwell, J. F., & Putnam, R. D. (2007). Education and social capital. Eastern Economic Journal, 33, 1–19.
House, J. S., Landis, K. R., & Umberson, D. (1988). Social relationships and health. Science, 241, 540–545.
Hurtado, D., Kawachi, I., & Sudarsky, J. (2011). Social capital and self-rated health in Colombia: The good, the bad, and the ugly. Social Science and Medicine, 72, 584–590.
Hyyppä, M. T., & Mäki, J. (2001). Individual-level relationships between social capital and self-rated health in a Bilingual Community. Preventive Medicine, 32, 148–155.
Islam, K., Merlo, J., Kawachi, I., Lindström, M., & Gerdtham, U. G. (2006). Social capital and health: Does egalitarianism matter? A literature review. International Journal for Equity in Health, 5, 1–28.
Iversen, T. (2008). An exploratory study of associations between social capital and self-assessed health in Norway. Health Economics, Policy and Law, 3, 349–364.
Jacobs, J. (1961). The life and death of great American cities. New York: Random House.
Jones, K. S. (2006). Giving and volunteering as distinct forms of civic engagement: The role of community integration and personal resources in formal helping. Nonprofit and Voluntary Sector Quarterly, 35, 249–266.
Kawachi, I., & Berkman, L. F. (2000). Social cohesion, social capital, and health. In L. F. Berkman & I. Kawachi (Eds.), Social Epidemiology. New York: Oxford University Press.
Kawachi, I., & Berkman, L. F. (2001). Social ties and mental health. Journal of Urban Health, 78, 458–467.
Kawachi, I., Colditz, G. A., Ascherio, A., Rimm, E. B., Giovannucci, E., Stampfer, M. J., et al. (1996). A prospective study of social networks in relation to total mortality and cardiovascular disease in men in the USA. Journal of Epidemiololgy and Community Health, 50, 245–251.
Kim, D., Subramanian, S. V., & Kawachi, I. (2008). Social capital and physical health. In I. Kawachi, S. V. Subramanian, & D. Kim (Eds.), Social Capital and Health. New York: Springer.
Knack, S., & Keefer, P. (1997). Does social capital have an economic payoff? A cross-country investigation. The Quarterly Journal of Economics, 112, 1251–1288.
Kowal, P., & Afshar, S. (2015). Health and the Indian caste system. The Lancet, 385, 415–416.
Kumar, S., & Pradhan, M. R. (2019). Self-rated health status and its correlates among the elderly in India. Journal of Public Health, 27, 291–299.
Lindström, M. (2004). Social capital, the miniaturisation of community and self-reported global and psychological health. Social Science and Medicine, 59, 595–607.
Lleras-Muney, A. (2005). The relationship between education and adult mortality in the United States. Review of Economic Studies, 72, 189–221.
Lochner, K. A., Kawachi, I., Brennan, R. T., & Buka, S. L. (2003). Social capital and neighborhood mortality rates in Chicago. Social Science and Medicine, 56, 1797–1805.
Lofors, J., & Sundquist, K. (2007). Low-linking social capital as a predictor of mental disorders: A cohort study of 4.5 million Swedes. Social Science and Medicine, 64, 21–34.
Loury, G. C. (1987). Why should we care about group inequality? Social Philosophy and Policy, 5, 249–271.
McKenzie, K. (2006). Social risk, mental health, and social capital. In K. McKenzie & T. Harpham (Eds.), Social capital and mental health. London: Jessica Kingsley Publishers.
Miller, D. L., Scheffler, R., Lam, S., Rosenberg, R., & Rupp, A. (2006). Social capital and health in Indonesia. World Development, 34, 1084–1098.
Mohan, J., Twigg, L., Barnard, S., & Jones, K. (2005). Social capital, geography and health: A small area analysis for England. Social Science and Medicine, 60, 1267–1283.
Mohseni, M., & Lindstrom, M. (2007). Social capital, trust in the health-care system and self-rated health: The role of access to health care in a population-based study. Social Science and Medicine, 64, 1373–1383.
Mundle, S., Chowdhury, S., & Sikdar, S. (2016). Governance Performance of Indian States: 2001-02 and 2011–2012. NIPFP Working Paper No. 164, National Institute of Public Finance and Policy.
Nahapiet, J., & Ghoshal, S. (1998). Social capital, intellectual capital, and the organizational advantage. The Academy of Management Review, 23, 242–266.
OECD. (2001). The well-being of nations: The role of human and social capital. Paris: Centre for Educational Research and Innovation.
OECD. (2010). Social capital, human capital, and health: What is the evidence?. Paris: Centre for Educational Research and Innovation.
Olsen, K. M., & Dahl, S. Å. (2007). Health differences between european countries. Social Science and Medicine, 64, 1665–1678.
Petrou, S., & Kupek, E. (2008). Social capital and its relationship with measures of health status: Evidence from the health survey for England 2003. Health Economics, 17, 127–143.
Ponzetto, G. A. M., & Troiano, U. (2018). Social capital, government expenditures, and growth. NBER Working Paper No. 24533, National Bureau of Economic Research.
Poortinga, W. (2006). Social relations or social capital? Individual and community health effects of bonding social capital. Social Science and Medicine, 63, 255–270.
Putnam, R. (1993). Making democracy work. Princeton, NJ: Princeton University Press.
Putnam, R. (2000). Bowling alone: The collapse and revival of American community. New York: Simon and Schuster.
Putterman, L. (1995). Social capital and development capacity: The example of rural Tanzania. Development Policy Review, 13, 5–22.
Rocco, L., Fumagalli, E., & Suhrcke, M. (2014). From social capital to health-and back. Health Economics, 23, 586–605.
Ronconi, L., Brown, T. T., & Scheffler, R. M. (2012). Social capital and self-rated health in Argentina. Health Economics, 21, 201–208.
Roodman, D. (2009). Estimating fully observed recursive mixed-process models with cmp. Working Paper No. 168, Center for Global Development.
Roodman, D. (2011). Fitting fully observed recursive mixed-process models with cmp. Stata Journal, 11, 159–206.
Rose, R. (2000). How much does social capital add to individual health? A survey study of Russians. Social Science and Medicine, 51, 1421–1435.
Rosenzweig, M. R., & Paul Schultz, T. (1983). Estimating a household production function: Heterogeneity, the demand for health inputs, and their effects on birth weight. Journal of Political Economy, 91, 723–749.
Ross, C. E., & Chia-Ling, W. (1995). The links between education and health. American Sociological Review, 60, 719–745.
Routledge, B. R., & von Amsberg, J. (2003). Social capital and growth. Journal of Monetary Economics, 50, 167–194.
Rupasingha, A., Goetz, S. J., & Freshwater, D. (2006). The production of social capital in US countries. Journal of Socio-Economics, 35, 83–101.
Sabatini, F. (2005). The empirics of social capital and economic development: A critical perspective. University of Rome La Sapienza, Department of Public Economics.
Scheffler, R. M., & Brown, T. T. (2008). Social capital economics and health: New evidence. Health Economics, Policy and Law, 3, 321–331.
Scheffler, R. M., Brown, T. T., Syme, L., Kawachi, I., Tolstykh, I., & Iribarren, C. (2008). Community-level social capital and recurrence of acute coronary syndrome. Social Science and Medicine, 66, 1603–1613.
Scrivens, K., & Smith, C. (2013). Four interpretations of social capital: An agenda for measurement. OECD Statistics Working Paper No. 2013/06, OECD Publishing, France.
Smith, D. H. (1994). Determinants of voluntary association participation and volunteering: A literature review. Nonprofit and Voluntary Sector Quarterly, 23, 243–263.
Stephens, K. K., Rimal, R. N., & Flora, J. A. (2004). Expanding the reach of health campaigns: Community organizations as meta-channels for the dissemination of information. Journal of Health Communication, 9, 97–111.
Sundquist, K., & Yang, M. (2007). Linking social capital and self-rated health: A multilevel analysis of 11,175 men and women in Sweden. Health and Place, 13, 324–334.
Tamura, R. (2006). Human capital and economic development. Journal of Development Economics, 79(2006), 26–72.
Vincens, N., Emmelin, M., & Stafström, M. (2018). Social capital, income inequality, and the social gradient in self-rated health in Latin America: A fixed effects analysis. Social Science and Medicine, 196, 115–122.
Viswanath, K., Steele, W. R., & Finnegan, J. R. (2006). Social capital and health: Civic engagement, community size, and recall of health messages. American Journal of Public Health, 96, 1456–1461.
Webbink, D., Martin, N. G., & Visscher, P. M. (2010). Does education reduce the probability of being overweight? Journal of Health Economics, 29, 29–38.
Wilson, J. (2000). Volunteering. Annual Review of Sociology, 26, 215–240.
Wolfinger, R. E., & Rosenstone, S. J. (1980). Who votes?. New Haven: Yale University Press.
Yip, W., Subramanian, S. V., Mitchell, A. D., Lee, D. T. S., Wang, J., & Kawachi, I. (2007). Does social capital enhance health and well-being? Evidence from Rural China. Social Science and Medicine, 64, 35–49.
Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.
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.
About this article
Cite this article
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
- Social and human capital
- Self-reported health
- Conditional mixed-process model
Mathematics Subject Classification