Institutional development gap in the social sector: Cross-country analysis

Abstract

An institutional quality convergence is always a relevant subject matter since institutional quality is considered to be a vital factor for economic development. The question regarding the convergence of social parameters into development is especially acute when choosing a social policy direction and the related instruments. This paper proposes a methodology to calculate the institutional development gap of social sector (IDGSS) in its three measures: social capital development, social infrastructure development, social security system development. IDGSS is calculated here for 20 countries. The estimation demonstrates how social development parameters (social capital, social infrastructure and social security) depends on a country’s economic development level. Besides, we show how IDGSS depends on noneconomic factors, including the level of basic institutions’ development, the degree of inequality in the distribution of income and poverty.