Evaluating eco- and human capital efficiency in Russian regions: insights from subjective well-being indicators in the context of geo-economic fragmentation

Relevance. Fostering well-being ranks high on regional social policy agendas. With the dynamic shifts in the international economic landscape, known as geo-economic fragmentation, there's a pressing urgency for stakeholders to optimize resource allocation at the regional level, increasing interest in efficient strategies to adapt to sanctions while enhancing overall well-being. Research objective. This article aims to investigate the dimensions and determinants of the eco- and human capital efficiency in Russian regions in the context of geo-economic fragmentation and sanctions pressure. Data and methods. A proposed three-stage approach integrates factor analysis to identify subjective well-being indicators, data envelopment analysis (DEA) to evaluate socio-eco-efficiency, and panel tobit regression to examine the determinants of efficiency. Microdata from the Rossat Comprehensive Observation of Living Conditions database were utilized, covering the period from 2014 to 2022. To assess efficiency, a DEA model is employed. The output indicators from this model were the estimated measures of subjective well-being. These indicators were validated through factor analysis and included professional satisfaction, safety assessment, accessibility and quality of social and cultural infrastructure in the regions. Results. In the given period, people reported feeling increasingly satisfied with jobs and quality of life, though there was a noticeable slowdown in the growth of human capital development indicators, environmental investments, and real income by early 2023. Efficiency varied significantly among the regions. Industrially developed mining areas and republics in the North Caucasus consistently showed high socio-eco-efficiency, despite limited resources. The efficiency benefited both from digitalization and increased per capita gross regional product, but urbanization had a negative impact. Conclusions. Amid geo-economic fragmentation, regional communities and job markets face significant challenges in adaptation. With the looming risk of declining satisfaction and perceived quality of life, it is imperative for regional policies to bolster tangible well-being indicators and invest in social capital and infrastructure to address these issues effectively.