Social Capital and Economic Development: PLS-SEM Model
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Doctoral School in the Social Sciences, University of Bialystok, Poland
Submission date: 2022-11-15
Final revision date: 2023-02-10
Acceptance date: 2023-04-04
Publication date: 2023-06-30
Corresponding author
Mateusz Borkowski   

Doctoral School in the Social Sciences, University of Bialystok, Poland
GNPJE 2023;314(2):11-27
The aim of this paper is to measure social capital and determine its effect on economic development across thirty five European economies from 2017 to 2020. Partial least squares structural equation modelling (PLS-SEM) was applied to measure and identify the relationship between latent (directly unobservable) variables. Social trust was found to be more strongly determined by interpersonal trust than by trust in organisations. Furthermore, social trust was also found to be the most important component of the overall measure of social capital. The latent variable representing social interaction and attitudes was found to be less important in the formation of social capital. Finally, a strong positive and statistically significant relationship was found between social capital and economic development.
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