The impact of factors describing social governance on economic governance in sustainable development

One of the important areas of scientific research on sustainable development includes factors affecting this development. As the nature of sustainable development is complex, it is necessary to examine various issues related to this development within four domains: environmental, economic, social and institutional-political. Mutual interactions between these governances are particularly interesting. Data for the analysis were obtained from the website of Eurostat. Variables were assigned to individual domains and divided into stimulants, nominants and destimulants based on the description of the variables provided by Eurostat. These data were used to determine the synthetic measure of economic governance and to select those groups of variables describing social governance that most completely describe economic governance. Hellwig’s taxonomic measure was used to achieve this goal. Total values for groups of variables relating to economic governance and total values for groups of variables relating to social governance were determined for 28 selected European countries based on observation conducted over successive ten years. These results were then subjected to the procedure of panel data modelling. A fixed effects model was then selected as the most appropriate model. The econometric model determined in the study describes economic governance based on four groups of variables selected from among seven groups characterizing social governance. The group of characteristics related to poverty and living conditions had the strongest positive impact on the direction of economic governance in the analysed period. The group of variables relating to consumption patterns and public health also had favourable effects on the synthetic measure of economic governance. Two groups of variables: ‘demographic changes’ and ‘public security’ had a negative impact on economic governance.