1. www.helsinki.fi/yliopisto Estimating gross domestic product (GDP) of 289 NUTS regions in Europe with subjective indicators for human and social capital 14.12.2015 The Department of Geosciences and Geography, Division of Urban Geography and Regional Studies/ Mikko Weckroth 1

2. www.helsinki.fi/yliopisto Outline 1. Aim of the study – what, why and how 2. Economy, happiness and causality 3. Method and data 4. Social well-being as social capital 5. Personal well-being as human capital 6. Descriptive statistics 7. Scatter plots 8. Regression models 9. Interaction terms 10. Conclusions 11 Discussion and future research 14.12.2015Osasto / Henkilön nimi / Esityksen nimi2

3. www.helsinki.fi/yliopisto Aim of the study  Spatial interdepence between economic well-being (GDP) and personal and social well-being (SWB)  Life satisfaction masks important information on the relationship between the objective and subjective well-being  Focus on ”functioning and flourishing” measures in SWB instead of life evaluations  Multidisciplinarity approach instead of spatial econometric analysis 14.12.20153

4. www.helsinki.fi/yliopisto Economy, happiness and causality ? - The link between happiness and wealth ? - SWB studies as growth critique - Regional studies have focused only on life satisfaction - Three traditions in SWB research (1) life evaluations account (evaluative measures), (2) the hedonistic account (affect measures) (3) the eudaimonic account (flourishing and functioning measures) 14.12.20154

5. www.helsinki.fi/yliopisto 14.12.2015 Osasto / Henkilön nimi / Esityksen nimi5 GDP SWB Life satisfaction SWB Flourishing and functioning measures

6. www.helsinki.fi/yliopisto Method and data - European Social Survey and Eurostat data - ESS 2012 includes module on functioning measures of SWB (14 items on social and personal wellbeing each ) - Control variables from Eurostat: employment rate, density, education level, governance Index, and R&D expenditure - GDP = control variables + social capital + human capital (+ adjustments for spatial autocorrelation of NUTS) - 37 956 individuals nested in 297 NUTS in 24 countries 14.12.2015 6

7. www.helsinki.fi/yliopisto Social well-being as social capital - Briding and bonding social capital - Social capital and economic outcomes ? - Social capital in ESS: - `Social trust´ - `Reciprocity´ - `Local regognition´ - `Social contact and support´ 14.12.2015 7

8. www.helsinki.fi/yliopisto 14.12.2015 8Osasto / Henkilön nimi / Esityksen nimi Rotated Factor Loadings LocalSocial contact Item Social trust Reciprocity recognition and support Most people can be trusted, or that you can´t be too carefull in dealing with people,757 Most people would try to take advantage of you if they got a chance, or they would try to be fair,754 Most of the time people try to be helpful or that they are or they are mostly looking out for themselves,656 To what extent do you receive help and support from people you are close to when you need it,753 To what extent do you provide help and support to people you are close to when they need it,662 To what extent do you feel appreciated by people you are close to,563 How much of a time during the past week you felt lonely -,281 -,224 To what extent you feel that people in your local area help one another,839 To what extent you feel close to the people in local area -,491 To what extent you feel people treat you with respect,343,479 Compared to other people of your age, how often would you say you take part in social activities,613 How often do you socially meet with friends, relatives or colleagues,579 How many people, if any, are there with whom you can discuss intimate and personal matters,434 In past 12 months, how often did you get Involved in work for voluntary or charitable organisations -,302

9. www.helsinki.fi/yliopisto Personal well-being as human capital - Education based human capital (Gleaser) vs. creativity based (Florida) - Indivual asset treated as common good - Human capital in ESS: - `Engagement´ - `Compentence and meaning´ - `Resilience´ - `Autonomy and control´ 14.12.2015 9

10. www.helsinki.fi/yliopisto 14.12.2015 10Osasto / Henkilön nimi / Esityksen nimi Rotated Factor Loadings Competence Autonomy ItemEngagement and meaning Resilience and control How much of the time would you generally say you are absorbed in what you are doing,858,201 How much of the time would you generally say you are enthusiastic about what you are doing,765,260,230 How much of the time would you generally say you are interested in what you are doing,752,252,218,224 I generally feel that what I do in life is valueable and worthwhile -,204-,670 Most days I feel a sense of accomplishment from what I do -,200-,528-,211-,230 There are lots of things I feel I am good at -,493 I feel that I am free to decide how to live my life -,344 -,315 To what extent do you feel that you have a sense of direction in your life,300,339,312,332 To what extent do you make time to do things you really want to do,234,454 When things go wrong in my life it generally takes me a long time to get back to normal,623 How difficult or easy do you find it to deal with important problems that come up in your life?,475,296 In my daily life I get a very little chance to show how capable I am,368 How much of the time during the past week you had lot of energy,270,326 To what extent you learn new things in life,255,308,322

11. www.helsinki.fi/yliopisto 14.12.2015 Osasto / Henkilön nimi / Esityksen nimi11 Descriptive Statistics MeanStd. Dev.MinMax N Regional GDP 2294114295260072600289 GDP log 4,25130,3423,414,86289 Human capital Engagement -,03,278-1,051,706289 Competence and meaning,01,226-1,026,644289 Resilience,02,232-,750,521289 Autonomy and control,00,161-,530,385289 Social Capital Social trust,00,421-1,584,792289 Reciprocity,05,234-,787,671289 Local recognition,02,224-,576,778289 Social contact and support,02,281-,734,614289 Control variables Population density 252,5679,717131289 Tertiary educated (% of total population) 26,538,659,955,7272 RD expenditure 448,8490,242962282 EQI index,1701,021-2,481,90282 Employment rate 64,2 7,739,481,8 272 Valid N (listwise) 258

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17. www.helsinki.fi/yliopisto 14.12.2015 Osasto / Henkilön nimi / Esityksen nimi17 Unadjusted regression estimates OLS Spatial filtering Constant 2.878 *** 2.589*** Human capital Engagement 0.069 -0.003 Competence and meaning 0.815*** 0.155*** 0.167*** Recilience 0.944*** 0.097 Autonomy and control 0.663*** -0.199** -0.162*** Social Capital Social trust 0.569*** 0.118*** 0.150*** Reciprocity 0.237* 0.014 Local recognition -0.210* -0.037 Social contact and support 0.786*** 0.221*** 0.234*** Control variables Population density (log) 0.131*** 0.078 *** 0.078*** Tertiary education (log) 1.360*** -0.203 ** -0.212*** RD expenditure (log) 0.464*** 0.302 *** 0.323*** Employment rate (log) 4.413 *** 0.434 * 0.576*** EQI index 0.263*** 0.022 Adjusted R 0.434 0.858 0.927 Dependent variable GDP lg

18. www.helsinki.fi/yliopisto Interaction terms  Bridging or bonding social capital?  ´Social trust´ (0.150***) X ´social contact and support (0.234***)´ has 0.209*** effect  Education based or ”creativity” based human capital?  ´Competence and meaning´ (0.167***) X ´Education rate´ (-0.212*) has a positive effect of 0.656*** 14.12.2015 Osasto / Henkilön nimi / Esityksen nimi18

19. www.helsinki.fi/yliopisto 14.12.2015 19Osasto / Henkilön nimi / Esityksen nimi Conclusions - ´Social trust´, ´ Social contact and support´ and ´compentence and meaning´ have robust and positive association to regional economic perfomance - Bridging and bonding social capital are associated with high GDP in a cross-sectional analysis - Subjective human capital (`competence and meaning´) is associated with high GDP while education based (´tertiary education`) is not

20. www.helsinki.fi/yliopisto 14.12.2015 20Osasto / Henkilön nimi / Esityksen nimi Discussion and what next - Enlargement to the conceptual toolbox for objective and subjective well-being comparisons - Policies focusing on positive functioning of population might carry economic outcomes - European Social Survey data should be utilized for regional analysis - Time series analysis with ESS - More exact measures for economic productivity - Inequality rather than aggeregates

21. www.helsinki.fi/yliopisto Thank you for your attention! Weckroth, M. T. K., Kemppainen, T., & Sørensen, J. F. L. (2015). Predicting GDP of 289 NUTS Regions in Europe with Subjective Indicators for Human and Social Capital. Regional Studies,Regional Science, 2(1), 311-330. 14.12.2015 Osasto / Henkilön nimi / Esityksen nimi21