Assessing the Causal Impact of Culture on Socio-economic Variables in European Countries
Year: 2024
Type: article
Abstract: Despite the growing attention to the impact of culture on socio-economic indicators, there is a lack of causality evidence. Scholars have noted that cultural values or norms, as well as, a vibrant cultural environment can have a positive impact on GDP growth, labour productivity, the attraction of human capital and the improvement of human well-being. However, the issue of endogeneity is not thoroughly debated. Not only can culture impact economic development, but socio-economic environment also affects the cultural indicators. Therefore, it is essential to identify the causal effects of culture. This article aims to assess whether culture has a causal impact on socio-economic variables. The Granger procedure is utilised to evaluate causal relationships, describing the cultural environment with a comprehensive set of 45 cultural indicators across 30 European countries. This enables the comparison of the relationship between culture and socio-economic variables using the same method across different countries. Additionally, cultural indices are constructed. The research is extended by employing a panel vector autoregression (VAR) model. The key finding of this article demonstrates a causal impact of culture on socio-economic indicators, confirmed by both the Granger procedure and panel VAR estimations. JEL Code: Z1
Author: Kristina Mažeikaite˙
Institution: Vilnius University
Language: English
Subfield: Demography
Field: Social Sciences
Domain: Social Sciences
Open Access status: hybrid
Estimated APC paid: $3,450
OpenAlex ID: W4404551960