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        Social Capital and Economic Growth: Empirical Investigations on the Transmission channels

        Ghazi BOULILA,Lobna BOUSRIH,Mohamed TRABELSI 한국국제경제학회 2008 International Economic Journal Vol.22 No.3

        This paper explores the possible transmission channels of social capital to economic growth for a sample of some developed and developing countries during the period 1980-2000, using a simultaneous equation model. The main results of this paper are first, the level of trust as a measure of social capital and growth are significantly and positively correlated. Second, a high level of trust has also an indirect effect on economic activity through its effect on institutional development. Third, such results are found to be robust statistically with the extreme bound analysis (EBA). It corroborates the fact that an improvement of the social infrastructure with high levels of trust and cooperation between individuals has not only a direct but also an indirect effect on economic growth through the development of institutions in the economy.

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