Effect of Social Cohesion on Economic Development (Cross-Country Study Using Panel Data Approach)

The purpose of this paper is to combine two concepts of economy and society to analyze the economic development by a social approach. Social cohesion is the situation which all elements of society be joined in a manner that makes an effective union. In this research، the social cohesion index for 85 selected developed and developing countries during 2008-2010 are calculated using “equality of opportunity” and “social capital” components. Then the effect of social cohesion on economic development has been examined، using panel regression analysis. The findings show that social cohesion has a positive and significant effect on GDP per capita، technological innovation، effectiveness of government institutions، quality of development policies and finally political and social stability.