Social Capital (Key Ideas)

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The term social capital refers to those stocks of social trust, norms, and networks that people can draw upon to solve common problems. Social capital represents a very important conceptual innovation for inter and trans disciplinary theoretical integration, especially between sociology and economics Adam and Roncevic [6]. The creation of social capital has been embraced as a solution for social problems as diverse as urban poverty and crime, economic underdevelopment and inefficient government Boix and Posner [9].

There has been exponential growth in references to social capital in academic literature in the last 15 years Aldridge et al. This growth in research and application to diverse areas represents an unprecedented acceptance, study and application of this single concept Adam and Roncevic [6]. Fine and Green suggested that social theory is being rewritten through the lens of social capital.

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The concept of social capital lends itself to diverse application as it is very broad and one may approach practically any social entity or situation through the conceptual framework of social capital Grootaert and Van Bastelaer b [12]. Citations with social capital, human capital and social networks in Econ Lit. Source: Isham, Kelly et al The concept of social capital is not new. Its intellectual history has deep and diverse roots which can be traced to the eighteenth and nineteenth centuries Adam and Roncevic [6]. The idea is connected with thinkers such as Tocqueville, J.

This is supported by Portes and Landolt [14] who believed that the origins of the concept lie in the nineteenth century classics of sociology. Heffron [16] made a tenuous link to the earliest human societies which attempted to accumulate productive assets, thereby creating social capital. Brewer [13] identified the link between the discussions of Aristotle and other early Greek philosophers on civic society and social capital theory.

Although authors seem to agree on the historical origins of the concept, there is debate in the literature over the first use of the term social capital. Most authors agree that the first use was by Hanifan in however others have identified Jacobs [17] Felkins [18] , Loury [19] Lappe et al.

Smith and Kulynych [24] identified that the next use of the term was by Jane Jacobs [17] in a discussion of urban vitality. Woolcock and Narayan [26] however, have identified a team of Canadian urban sociologists, Seely, Sim, and Loosely [28] and an exchange theorist, Homans [29] that predate Jacobs.

It seems that the next use of the term was by Loury [19] Portes [15] ; Woolcock and Narayan [26] which is commonly cited in the literature. It is interesting to note that in each of these early uses of the term social capital the author did not cite earlier work on the subject Woolcock and Narayan [26].

As identified above the term social capital has only been used since the early twentieth century but its traditions are much older, rooted in economics, sociology, anthropology and political science literature Grootaert and Van Bastelaer a [31] ; Healy and Hampshire [32]. The concept is similar or equivalent to civic tradition, civicness and civic involvement Adam and Roncevic [6]. Some authors point out the similarity between social capital theory and moral philosophy due to the normative, goal-directed character of the process of production Favell [33] ; Sampson et al.

Boix and Posner [9] posited theories of social capital as an equilibrium concept; repeated cooperation increases the available stock of social capital, high stocks of social capital, in turn, make it possible to sustain social cooperation. Economists point to the origin of social capital theory being in the formative period of economic sociology with Max Weber Trigilia [35] , and others draw links to Adam Smith Portes and Landolt [14] ; Winter a [25] ; Winter b [36]. Winter a found commonality between social capital theory and the questions posed by Adam Smith in The Theory of Moral Sentiments [].

Knack [37] identified Adam Smiths discussion of the potential negative spillovers of group activities as an aspect of social capital debate. From this discussion it can be seen that the concept of social capital is not new, although the term is. The origins of the concept can be traced to thinkers of the eighteenth and nineteenth centuries and is rooted in economics, sociology, anthropology and political science literature.

Since its original use, the term has received unprecedented acceptance and application to diverse areas. A discussion of the contemporary authors on social capital will follow in the next section. This article is part of a thesis submitted to the University of Queensland, Australia. You should reference this work as:. Then, copy and paste the text into your bibliography or works cited list. Because each style has its own formatting nuances that evolve over time and not all information is available for every reference entry or article, Encyclopedia.

The term social capital first began to be defined in the s and remained largely restricted to the academic world of the social sciences until the s, when it suddenly emerged as a central element in public discussions and policy debates about the quality of civic culture in Western nations, especially the United States of America.

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  5. At the same time it also gained a place of prominence in discussions of political and economic "development" in the non-Western world by international agencies such as the World Bank. Despite this rapid ascent — becoming a key analytical concept used by academics primarily sociologists, political scientists, and economists, but also anthropologists and historians , government policy planners, and international officials in development agencies within less than a generation — a firm definition of the term has not yet emerged, which is not surprising given that what it seeks to describe is largely intangible, diffuse, and elusive.

    As a result there has been a proliferation of usages, which has weakened the conceptual cogency of the term.

    Broadly defined, what most authors mean in the early twenty-first century, when they write of social capital are social networks of cooperation in which people invest and from which they may ultimately derive benefits. According to most contemporary theorists of the concept, the three most important diagnostic features of such networks are social interaction, civic trust, and normative behavior. Social capital is a theoretical concept rather than a clearly tangible phenomenon. Interaction, trust, and norms are observable and even measurable phenomena, whereas social capital is not itself perceptible, and hence difficult to define.

    Nevertheless, the first references to the term as opposed to a defined concept of social capital were observational rather than theoretical. Most studies trace the first use of the term to a academic study by Lyda Judson Hanifan, a school supervisor, on the deterioration of civic culture in rural West Virginia. The next and perhaps most influential use of the idea came with Jane Jacobs 's study of the decline of American cities, a study that was based on her close observations of the changing nature of urban communities in New York City.

    Both authors called attention to the features and benefits of close social communities, and hence the need to preserve them. It was not until the s that the idea began to attract theoretical attention in the academic world; elements of the theory of social capital predate these attempts at definition, having been traced back to the idea of, among others, Jeremy Bentham — , James Mill — , Alexis de Tocqueville — , Karl Marx — , Max Weber — , Georg Simmel — , John Dewey — , and Emile Durkheim — It is widely accepted that the three most important proponents of the concept of social capital have been the French social theorist Pierre Bourdieu — and two American social scientists, the sociologist James Coleman and the political scientist David Putnam.

    Their definitions of the concept, which vary considerably, usefully summarize a range of analytical and definitional perspectives. Bourdieu's conceptualization of social capital, which owed nothing to the work of Hanifan and Jacobs, came out of his understanding of the workings of cultural capital among the upper classes of French society. He was interested in elucidating disguised or invisible forms of capital that were deployed by elites to maintain social inequality. He saw the nonmaterial exchanges inherent in social relationships as producing resources that members of elites drew upon to maintain their positions within the existing social structure.

    This view of social capital was very hierarchical and exclusive in its conceptualization, whereas Coleman's understanding of social capital was egalitarian and benign.

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    5. Social capital.
    6. His interest in social capital came out of his research on the importance of family and community in educational results. He found that familial and community resources, which he defined as social capital, were sufficiently powerful to compensate for economic disadvantages. For Coleman, whose definition of social capital drew on the concept of human capital that had been current in economics for over two decades, not only individuals benefited from social capital, but also society as a whole.

      The highly influential definition of the social capital put forward by Putnam in the s originated in his examination of the differences in civic engagement in northern and southern Italy; he used the concept to explain the more successful integration of civil society and the state in the north, which he traced back to medieval guilds. He went on to apply the concept of social capital to his study of civic culture in the United States ; in an article published in , which anticipated and summarized the argument of his book Bowling Alone, he brought the concept of social capital into the world of political debate and the popular media, first in the United States and then internationally.

      Putnam looked at social capital primarily in terms of its benefits to society rather than the individual. He argued that there was a direct correlation between the quality of civic culture and levels of poverty, violence, and democracy. The diagnosis became popular in no small part because it suggested noneconomic solutions to social problems: increase social capital and solve a range of social problems. However, there was at least one major flaw in such reasoning: Putnam had failed to consider the role of economics adequately in the deterioration of civic culture in the first instance.

      Furthermore, as critics of Putnam, such as Alejandro Portes, have noted, social capital can itself lead to social problems, whether in the form of organized crime associations, prostitution and gambling rings, or youth gangs. These negative forms of social capital are much different than newspaper readership, voluntary associations, and political trust, which were the positive forms Putnam examined. Social capital has been appealing to both conservatives, who use it to argue for the devolution of former governmental responsibilities onto society, as well as to liberals, who see it as a means for the state to deal directly with the causes of social problems rather than merely their symptoms.

      Despite the divergent ideological lessons drawn from it, there is wide agreement about the importance of the concept in both academic and public policy circles today. However, there is no consensus on how to measure it. Unlike conventional forms of capital, social capital is primarily relational rather than material. Some economists have been skeptical about the cogency of the concept as well as about the ability of proponents of social capital to arrive at quantifiable measures. Measuring social capital has been a particularly important task because of the prominent role the concept has assumed in discourses concerning economic development in the non-Western world, where the emphasis is not on civic culture but directly on amelioration of economic and political conditions.

      By bringing the social to the forefront of discussions of economic and political conditions, social capital has had an important impact on the thinking of institutions such as the World Bank about development in the non-Western world. But the application of the concept beyond the West has raised a series of important questions, the central one of which is its relationship between society and the state. Some forms of social capital have been seen as inimical to economic and political development; where states have collapsed or become oppressive and economies deteriorated, and where accordingly survival strategies have heightened the importance of social capital, the symptoms have been read as a cause of continuing economic and political failure.

      Many forms of social capital that appear to be negative in the context of the West, must be understood within the much different historical origins and more problematic dynamics of the relationship between state and society in many parts of the non-Western world. Both within the West and for the non-Western world, the idea of social capital offers new ways of thinking about social problems. In particular, it offers the possibility of integrating our understandings of the social and economic; however, if not properly integrated there is a real danger of the latter merely colonizing the former, thereby reducing social interactions to sets of instrumental strategies and rational calculations.

      Simply because it is a relatively recent concept, it requires further elaboration and refinement, which it is already beginning to attract. Even more nuanced insights will result. New York : Greenwood Press, Collier, Paul. Cambridge, Mass. Dasgupta, Partha, and Ismail Serageldin, eds. Social Capital: A Multifaceted Perspective. Washington, D. Farr, James. Jacobs, Jane. New York : Random House, Putnam, Robert.

      New York: Simon and Schuster, Princeton: Princeton University Press, Rotberg, Robert I. Introduction to two special issues of JIH : 29, no. Social capital refers to the intangible resources embedded within interpersonal relationships or social institutions. Social capital can exist in three major forms: as obligations and expectations, as information channels, and as social norms. Obligations and expectations can be conceived of as a "credit slip" that people hold, and that can be cashed when necessary.

      Information channels provide appropriate information as an important basis for action. Social norms provide the criteria for rewarding or sanctioning individual actions. In the context of education, social capital in the forms of parental expectations, obligations, and social networks that exist within the family, school, and community are important for student success. These variations in academic success can be attributed to parents' expectations and obligations for educating their children; to the network and connections between families whom the school serves; to the disciplinary and academic climate at school; and to the cultural norms and values that promote student efforts.

      The concept of social capital is a useful theoretical construct for explaining the disparities in students' educational performance among different nations. In the s James Coleman developed the concept of social capital to conceptualize social patterns and processes that contribute to the ethnic disparities of student achievement. He argued that the educational expectation, norms, and obligations that exist within a family or a community are important social capital that can influence the level of parental involvement and investment, which in turn affect academic success.

      At the family level, parents' cultural capital and financial capital become available to the child only if the social connection between the child and the parents is sufficiently strong. Youths from single-parent families or with larger numbers of siblings are more likely to drop out of high school because of the eroded social capital associated with the nontraditional family structure. As new structures of the household in modern society become more prevalent, many linkages and activities that provided social capital for the next generation are no longer present, and their absence may be detrimental to children's learning.

      At the institutional level, disciplinary climate and academic norms established by the school community and the mutual trust between home and school are major forms of social capital. These forms of social capital are found to contribute to student learning outcomes in East Asian countries such as Singapore , Korea , and Hong Kong. They have been shown to have a significant impact, not only on creating a learning and caring school climate, but also on improving the quality of schooling and reducing inequality of learning outcomes between social-class groups.

      In summation, the concept of social capital is a useful tool for understanding differences among student learning outcomes. Nations with high stocks of social capital are more likely to produce students with better academic performance than nations with low stocks. However, studies by Pamela Paxton, and Michael Woolcock and Deepa Narayan, have noted that high levels of social capital could restrict individual growth and societal development.

      Further analysis is needed to identify the potential negative impact of high social capital. Ho, Sui Chu. Ho, Sui Chu, and Willms, J. Paxton, Pamela. A Multiple Indicator Assessment. Sampson, Robert J. Stevenson, Harold W. New York : Simon and Schuster. Woolcock, Michael, and Narayan, Deepa. The concept parallels those of physical and human capital in economics. Coleman and Hoffer argued that deficiencies in social capital—such as would follow from single-parenthood, decreased parental involvement with the child or with family activities, and low levels of interaction between adults and especially parents in local communities—were detrimental to development in adolescence.

      Closed networks, giving rise to functional communities, foster among children living therein such things as conformity to school norms, an interest in academic matters, and avoidance of deviance. Lack of interaction between parents and children, and between parents and other adults, fosters open networks, lack of communication, lack of adherence to and enforcement of norms and of family control, all of which reduces the probability of building up human capital and increases opportunities for deviant behaviour.

      It has been suggested that this argument represents a significant shift in Coleman's thinking about academic socialization from his earlier work. In his classic The Adolescent Society , Coleman stresses the importance for adolescence and educational achievement of the youth cultures within schools, whereas the concept of social capital emphasized the out-of-school influence of the family as it interacts with the larger community.

      However, it has also been observed that it is possible to marry the two accounts, by considering the possibility that social capital lack of parental monitoring, the decision to reside in particular neighbourhoods, and to establish ties with some but not other types of parents and institutions in the local community exerts an indirect influence on peer- group selection among children; that is, that social capital is an indirect determinant of the subcultures in which young people become involved, both in the community and at school.

      Social capital has been defined as "the resources that emerge from one's social ties" Portes and Landolt , p. Homans was interested in understanding how people in some small groups but not others are able to expand a group and transform it into a complex organization. This is accomplished, he argued, by group members engaging in social exchange to such a large extent that a "surplus" of interaction, activity, and sentiment the building blocks of social exchange accumulates Homans That surplus can be directed toward the creation and maintenance of elaborate social structures, which facilitate more interaction and activity among group members in an iterative and self-reinforcing process.

      An input to production in this case the production of a social form that has been produced by a prior process in this case a prior process of social exchange is referred to by economists as a capital resource and, in this instance, as social capital. In the late s the sociologist Pierre Bourdieu and the economist Glen Loury independently began to use the term. Bourdieu incorporated into his definition of social capital the Marxist idea that the raw material that produces a capital resource is always, at its ultimate origin, human labor.

      Loury's work examined the effect of differential access to social capital by ethnic group. His analysis found that in a society that is ethnically stratified, differential levels of resources by ethnicity at the group level are an important determinant of individual earnings. Coleman brought the concept of social capital into widespread use in the social sciences Coleman , Notable examples of its use are found in the work of the political scientist Robert D. Putnam has been concerned mainly with the effects of social capital on political forms and levels of participation, such as the contrasting political outcomes in northern and southern Italy and the apparent fall in the level of associational activity in the United States.

      Other researchers have examined how social capital promotes child development and affects health outcomes for individuals. There are two distinct views of social capital in this research. In one view social capital is considered a group-level resource to which all the members of a group have access; in the other it is considered an individual resource that is inherent in social structures. Coleman took the former position, in which it is thought that an individual's level of social capital can be measured by that individual's membership in a particular group. Critics argue that construing social capital as a group resource leads to measurement ambiguities, for example, making it impossible to distinguish between social capital and its putative benefits, such as trust and norms.

      This position tends to downplay the effects of stratification within a group, making social capital merely a public good that is equally accessible to all. Moreover, this approach leads to the view that social capital by necessity confers benefits on individuals, which need not be the case. The alternative view—social capital as a resource specific to individuals—ties the concept to the literature on social networks. Network analysis provides conceptual and analytic tools that can be applied to the study of social capital, investigating, for example, how a person's location in a social network affects that person's access to social capital or how the embedded resources in a particular social network affect network members' levels of social capital.

      For population scientists the concept of social capital has potential value in illuminating both the motivations of individuals to form social relationships and the consequences of social relationships for individual well-being. Many of the individual behaviors that in the aggregate produce demographic outcomes can be seen as investments or disinvestments in social capital.

      Such behaviors include forming sexual partnerships, rearing children, moving, coresidence, intergenerational exchange, and caring for the frail, the disabled, and the ill. Trends and differentials in these behaviors can be interpreted in part as resulting from shifts in the value of the social capital available to those who engage in them Astone et al.

      Fertility transition, for example, could be seen as the outcome of a shift in investment from social capital to other kinds of capital, particularly human capital, perceived as offering higher returns. Astone, Nan Marie, Constance A. Nathanson, Robert Schoen, and Young J. John G.

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      New York : Greenwood. Homans, George C. The Human Group. New York : Harcourt, Brace and World. Peter Marsden and Nan Lin. Beverly Hills, CA: Sage. Cambridge, Eng. Lin, Nan, Walter M.

      Social Capital

      Ensel, and John C. Wallace and Annette M. Lexington, MA: Lexington Books. Making Democracy Work. Social capital is a form of capital that exists within relationships among individuals. According to Bourdieu , capital is accumulated labor that can be appropriated by individuals or groups for their exclusive use to further their interests and increase their capital holdings. By drawing on the social capital resources in their relationships, individuals can further their own goals. For example, the larger the social network an individual has while looking for a job, the more resources—through company contacts, information, and higher-status references—that individual can draw on.

      Greater availability of resources increases the likelihood that the individual will find a job better than will an individual with fewer social network resources. It is also likely that a well-connected individual will find employment sooner. Simply put, social capital is "an elegant term to call attention to the possible individual and family benefits of sociability" Portes and Landolt , p. Some scholars have remarked on the "plethora of capitals" recently appearing in social and economic theories that refer to virtually all aspects of social life as a form of capital Baron and Hannan The notion of physical capital, as embodied in machines, tools, and equipment, has been extended by economists to include human capital.

      Just as investments can be made to improve physical capital—newer and better tools—human capital can be increased by enlarging an individual's skills or knowledge base. Social capital, then, is created when relationships are used to enable actions by individuals to further their own interests. According to Coleman , each actor has control over and interests in certain resources and events.

      Social capital constitutes a specific kind of resource that is available to an actor. Unlike other resources, social capital is based on reciprocity and thus comes with the expectation that obligations will be repaid as requested by other individuals in the network. Social capital does not have a set rate of exchange, and payments often are made according to need rather than in standard purchase terms as is done with equipment and education.

      The theoretical foundation of the concept of social capital is still in a nascent phase, and there is much debate about its definition, creation, and utility as well as its role in public policy and modernization strategies. Advanced most notably in the work of the French sociologist Bourdieu and further developed by Coleman, the notion of social capital has been put forth as a conceptual tool to bridge two divergent theories of social action: economism and semiologism Bourdieu Economism reduces all social exchanges to economic transactions in which independent social actors pursue their own self-interest with little attention to social context.

      In this view, social action is based on the principle of maximizing utility. In contrast, semiologism reduces social exchanges to communicative acts by socialized actors and downplays the impact of economic factors. In this theoretical orientation, social action is governed by social norms, rules, and obligations.

      The notion of social capital mediates these divergent orientations by acknowledging both the self-interest of actors and the influence of the social and economic context. As social capital refers to the aspects of the social structure that are of value to social actors as resources that can be mobilized in pursuit of their interests, it is defined by its function.

      Social capital is not located in the actors themselves as with human capital or in any physical implements of production as with physical capital. Instead, it is located in the relationships and personal networks between and among social actors. Social capital, then, appears in a variety of forms that have two common elements: 1 Social capital appears as an aspect of social structures, and 2 actors are able to use social capital as a resource to achieve their goals within the social structure.

      Coleman , conceives of social capital as a social structural resource that is a capital asset for the individual. It is productive, making it possible to achieve certain goals that cannot be achieved in its absence, and it is constituted within social organizations often as a by-product of activities undertaken for other purposes.

      For Coleman, the value of the concept lies primarily in accounting for different outcomes of individual efforts and illuminating how resources can be combined with other resources to create system-level differences. The concept of social capital is most useful in qualitative analyses of social systems and studies relying on qualitative indicators. Coleman identifies six forms of social capital: obligations and expectations, information potential, norms and effective sanctions, authority relations, appropriable social organizations, and intentional organizations.

      Obligations and Expectations.

      Social capital: exploring the theory and empirical divide

      A social system that relies heavily on reciprocal actions creates obligations and expectations on the part of its participants. Each "favor" is expected to be repaid, and those who can provide "favors" are expected to do so when requested. This form of exchange engenders social capital for a group member who has done many favors without collecting reciprocal favors in return. These unreciprocated favors create obligations that allow the favor-granting member to request aid from those who are obligated to her or him. These unpaid obligations accrue in the form of social capital that the member can use.

      This form of social capital has two critical elements: the mutual trust within the social system and the extent of outstanding obligations. Without trust that obligations will be reciprocated, there is no incentive to accrue social capital. For social capital to have value, there must be trust that the resources will be there to be drawn on when needed.

      Furthermore, it is the extent of outstanding obligations that denotes the amount of social capital an individual can draw on. Indeed, the overall number of outstanding obligations within a system can be a measure of its interconnectedness as members are obligated to one another. This connectedness also increases the resources available to each member. Information Potential.

      By interacting with informed members, individuals can increase their knowledge without having to obtain the information directly, whether by reading the newspaper or by interpreting research findings.

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      A member also may become privy to specialized information— such as unadvertised business opportunities—through informal information exchange. Useful information can be the impetus for action that furthers the individual's on goals and can be a beneficial commodity. Norms and Effective Sanctions. Within a social system, norms can support and provide rewards for specific behaviors. Norms that encourage the subjugation of self-interest to the needs of the community are an especially powerful form of social capital.

      By promoting certain activities, norms by nature constrain other activities. Criminal pursuits are an obvious example of activities that communities want to constrain. Less obvious examples would be that the promotion of athletic activities constrains the time available for other interests and that norms that promote conformity constrain innovation. Effective "norms can constitute a powerful form of social capital" Coleman , p. Authority Relations.

      Social Capital

      Within groups organized to address a specific issue, a leader often is chosen and given the right to make decisions and speak for the group. Thus, the members of the group transfer the "rights of control" to one individual, who then has access to an extensive network of social capital that can be directed toward a specific goal. When the rights of control are located in one individual, the social capital of all the members is amplified.

      Examples of this form of social capital can be found in political action groups, business cartels, and grassroots organizations. Appropriable Social Organizations. Social organizations usually are created to address a specific issue, and after that issue is resolved, the organization often continues to exist through a redefinition of its goals. Thus, an organization that was developed for one purpose can be appropriated for another purpose. This constitutes a form of social capital available for use.

      Intentional Organizations. This form of social capital occurs when individuals join together to create an organization that will benefit them directly. An example of this can be a joint business venture or a voluntary association that produces a public good, such as a Parents and Teachers Association PTA chapter. This form of social capital advances the interests of those who invest in it.