A longitudinal-national study) 1990-2014(on the effect of social capital on industrial development

The purpose of this research is the study on the mechanisms of the effect of social capital on the level of industrial development in 139 societies over the period 1990 to 2014. Because of the existence of missing data for some societies and years, the data structure is unbalanced panel data structure and Due to the importance of causal mechanisms, data analysis has been conducted using path analysis method. The results showed that the most important mechanism of the effect of social capital on the level of industrial development of societies is the institutional quality mechanism; high level of social capital in societies improve the institutional quality structure of societies and thus has a positive effect on the level of industrial development. The second casual mechanism is the mechanism of human capital, according to which increasing the level of social capital in societies leads to more investment of households in education and as a result, increasing the level of human capital in society has a positive effect on the level of industrial development. Finally, the results showed that social mechanisms have a greater effect on industrial development compared to the economic mechanisms.