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Effects of social capital on self-rated life-satisfaction among residents: evidence from Vietnam

(A thesis submitted in partial fulfilment of the requirements for the degree of MASTER OF ARTS IN DEVELOPMENT ECONOMICS, VIETNAM – THE NETHERLANDS PROGRAMME FOR M.A IN DEVELOPMENT ECONOMICS)


By Truong Ngoc Anh Thu (VNP 21)

Academic Supervisor: Dr. Pham Khanh Nam


This paper provides an insight into the relationship between self-rated life-satisfaction and social capital, controlling for some demographic and individual characteristics in rural Vietnam as well as tests the theoretical predictions of the social capital investment model from the data of Vietnam Access To Resources Household Survey in 2014. Social capital is measured as a multidimensional concept including social network, formal institution, cooperation and social trust. The results are quite consistent with the predictions, which supports the theory about the social capital investment of Glaeser et al. (2002) that people who have higher education would have more investment in their social capital, and being stable in the residence also contributes to their investment of social capital while relatively higher income affects their social network and trust negatively. Finally, the association between age and formal institution follows the inverted U-shaped trend. Using order probit model on data for 3415 households from twelve provinces in Vietnam, it is found out that there is a significantly positive relationship between social capital in forms of social network, formal institution and cooperation and an individual’s subjective satisfaction. However, trust, on the other hand, is examined to be insignificantly associated with a person’s self-rated satisfaction in this research.

Keywords: social capital, social network, cooperation, formal institution, social trust, happiness, life-satisfaction, order probit model, rural Vietnam

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Full version is available at Library of Vietnam-Netherland Progamme: 1A Hoang Dieu, Phu Nhuan Dist, Ho Chi Minh city, Vietnam.