Assessing the non-economic outcomes of social and solidarity economy in Luxembourg

In recent years, Social and Solidarity Economy (SSE) has gained considerable attention in policy debates. Despite the increasing recognition and promotion of SSE, there is still a lack of empirical studies about its... [ view full abstract ]

In recent years, Social and Solidarity Economy (SSE) has gained considerable attention in policy debates. Despite the increasing recognition and promotion of SSE, there is still a lack of empirical studies about its non-economic impact on social issues such as people's well-being.

The appeal of social economy, indeed, is linked to the belief that its new forms of economic organization are socially desirable: since traditional economy is not sufficient to assure employment, growth and well-being, it is necessary to complement it with new ways to organize economic activity to satisfy collective needs. Policy actors around the world are increasingly looking at the social economy to support societies and deliver welfare services. At least in the Western world, social enterprises are increasingly seen by governments and non-government agencies as important for addressing social and economic exclusion, and providing much-needed services to disadvantaged people such as trainings and jobs, as well as delivering services to marginalised groups.

Hence, it is relevant to assess whether SE delivers the expected social outcomes in terms of higher well-being of local communities, better health, higher job satisfaction and job creation, and social cohesion. This work provides an empirical assessment, using survey and register data, of the effectiveness of SSE in Luxembourg using subjective well-being to evaluate the non-economic outcomes of SSE. I used the Luxembourgian 2013 GEM data and the information from the Business Register. Results suggest that SSE has an effective and lasting impact on subjective well-being. By providing an individual based assessment, subjective well-being offers an encompassing measure of quality of life to complement more traditional income-based measures. At the same time, this approach provides a direct way to assess the impact of SE on the quality of life of the local community. We find a sizeable contribution of the social economy to the well-being of some of the most vulnerable people in the society: poor and unemployed people. In sum, we find evidence to support the claim that the higher the density of social enterprises, the higher is the quality of life of people.