Social Progress-Economic Performance Nexus: Causality Analysis for D8 and G8

This study examines the relationship between social progress and economic performance across countries with varying levels of development.While social progress enhances well-being through improvements in education, health, and quality of life, its connection to economic development may differ by context.The research investigates this relationship for G8 and D8 countries over the 2000-2020 period using the Knya Bootstrap panel causality test, which accounts for inter-unit heterogeneity and cross-sectional dependence.Social progress is represented by the Social Progress Index (SPI), while a new economic performance indicator is constructed using Multi-Criteria Decision Making (MCDM) methods.The results indicate a unidirectional causality from economic performance to social progress in G8 countries, whereas evidence for causality from social progress to economic performance is stronger in D8 countries.These findings suggest that promoting social progress may enhance economic performance in developing contexts.Limitations include issues related to endogeneity and the exclusion of potentially relevant variables.