The influence of social investment on subjective capacity throughout the life course

This article investigates how social investment welfare provision affects a novel subjective wellbeing concept ‘subjective capacity’ that is understood in terms of agency, resilience, optimism and a sense of purpose. It explains how social investment service provision, such as early childhood education and care, active labour market policy, and active ageing support influence subjective wellbeing across the critical life stages of parenthood, unemployment, and ageing. The subjective capacity approach enables this study to move beyond traditional wellbeing concepts such as income or happiness, and thereby offers a deeper understanding of the influence of social investment. Utilizing data from Eurofound’s European Quality of Life Survey, OECD’s Social Expenditure Database, and Labour Market Programme statistics, this study employs linear multilevel regression models to analyze cross-level interactions between policy effort (in terms of expenditure) and consecutive life-course stages on subjective capacity. Specifically, in-kind expenditure on family and old-age policies demonstrates significant positive effects. However, the influence of labour market policies is less pronounced. With higher in-kind spending, parenthood is associated with a positive impact on optimism and a sense of purpose. By contrast, unemployment exhibits minimal changes in agency, optimism, and purpose, yet yields positive effects on resilience. Ageing positively influences agency and resilience, with minimal impact on optimism and purpose.