The Importance of different forms of social capital for happiness in Europe: A Multilevel Structural Equation Model (GSEM)

Abstract

This paper investigates the effects of different dimensions of social capital ​on happiness of Europeans. Unlike other studies, a categorical principal component analysis (CATPCA) is applied to obtain the dimensions of social capital. The data used come from the ninth wave of the European Social Survey (ESS), year 2018. Happiness is modelled using a multilevel structural equations model (GSEM) by country to study the role of social capital in Europeans' happiness, when controlling for the effect of factors such as gender, unemployment, age, low income, higher education, and living with a partner. Social capital is measured as a multidimensional concept composed of institutional trust, social trust, social ties and voluntary association, civility and sense of belonging, and religiosity. Among the results, we found that the five dimensions that build social capital have a positive impact on happiness. In addition to the positive effects of social capital, the control variables have the expected impact. In a context marked by growing individualism and social isolation, the results of this work can guide policy makers in using the dimensions of social capital to increase the subjective well-being of the population.