Relational Capability Index 2.0

Relational Capabilities, as introduced by Giraud et al. (2013) aims to introduce social capital and social inclusion in the capabilities paradigm. This paper presents RCI 2.0, an alternative version of the Relational Capability Index (RCI). It is tailored for long-run monitoring of a country’s performance and cross-country comparison. It gives due consideration to the critics on aggregation methods that applies to multidimensional development indicators or ‘composite’ indexes. For the first time, we use the Gallup World Poll database. The richness of the database allows disintegrating the RCI 2.0 into different groups: rural vs. urban, by gender, and by income levels - across the world - decoupling the possibility of analysis. Our results verify second order stochastic dominance across all the aforementioned groups when weighted by population size. We also find RCI 2.0 to be strongly correlated to the Human Development Index and income levels in our sample of countries.