On the sources of European regional convergence: Does social capital have an economic payoff?

Recent literature has shown how relevant social capital may be as an important determinant of economic growth. However, the empirical evidence in contexts such as Europe, particularly at the regional level, is still scant, and its likely implications for income convergence are entirely unexplored. We analyze how social capital has influenced per capita income convergence for 216 European Union (EU) regions, a relevant context not only in light of the cohesion policies but also due to the remarkable disparate social capital endowments at the regional level. By using the distribution dynamics approach to convergence analysis, results generally support the relevant conditioning role of social capital for per capita income convergence, although the impact varies depending on the dimension considered—social trust, participation in associations, or the quality of social norms.