Disentangling the Causal Structure Between Social Trust, Institutional Trust, and Subjective Well-Being

Previous research indicates a positive relation between social trust, institutional trust and subjective well-being. Besides theoretical assumptions and cross-sectional relations, only few studies so far examined the causal structure between these concepts. However, previous studies showed contradictory results, possibly due to different methods and datasets used. Hence, we analyzed the causal structure between the three concepts on the aggregate country-level using the European Social Survey, which offers a total of 217 observations from 30 countries, nested in nine time-points between 2002 and 2018. We targeted a causal effect by using a multilevel bivariate cross-lagged analysis. This way we analyzed if previous values of the respective explanatory variable predicts future values of the respective criterion variable. Using this method, we were able to (1) separate the relevant within-country from the between-countries effect, (2) control for different effects in different countries, (3) control for covariates as well as for autoregression of the respective criterion variable over time, and (4) control for residual correlation between the respective criterion variables. Our results suggest a causal effect from subjective well-being to social trust, but little evidence for a reverse causal pathway. Further, we found no effect from social trust and subjective well-being on institutional trust and only small but negative effects vice versa. The results suggest treating social and institutional trust not as preconditions of subjective well-being, but rather as independent facets for the quality of life of a society as already implemented by the OECD's better-life index, amongst others.