Conclusions

In this chapter we have tried to provide an overview of the state of social capital research by both describing the state of the conceptual, theoretical and econometric literatures on social capital and by surveying a number of empirical studies.

With respect to empirical work in general, social capital research has led to the de­velopment of a number of interesting data sets as well as the development of a number of provocative hypotheses, much of the empirical literature is at best suggestive and at worst easy to discount. So while one can point to no end of studies in which a variable that is asserted to proxy for social capital has some effect on individuals or groups, it is usually very difficult to treat the finding as establishing a causal role for social capital. We have highlighted a number of studies that we think are particularly strong, but those studies we find persuasive are relatively exceptional. The defects of the empirical social capital literature are unfortunate, since the work on social capital is an active front along which the ‘undersocialized conception of man’ for which economics has been criticized [Granovetter (1985)] is being addressed.

One recommendation we make in regard to empirical studies is that the social capital literature pay far more attention to formal issues of identification, self-selection and unobserved group characteristics. These issues have been extensively studied in the closely related context of social interactions [cf. Brock and Durlauf (2001c)] and many ideas from that literature may be applied to social capital. In addition, we believe that empirical social capital studies must do a much better job of differentiating between social capital effects and alternative types of group effects. One possibility in developing more persuasive evidence of social capital effects is the broader use of survey data. Such an approach has proven quite successful in recent efforts to understand how individual wellbeing, i.e. happiness, is affected by socioeconomic outcomes.^[428]

Attempts to provide social richness to economic analysis will only succeed if the theoretical and empirical work that accompanies this effort is subjected to the same rigorous standards that are required of other analyses in economics. In contrast, the extravagant claims so often found in this literature [the most prominent example of which is Putnam (2000)] are easy to undermine when these standards are applied and so will not contribute to social science in the long run.^[429] Beyond the failure to contribute to the social science enterprise, there is a legitimate concern that studies which make excessive claims and unsupported assertions can have the long run effect of discrediting social capital as an idea. In conclusion, what the social capital literature ultimately needs is more matter and less art.

Acknowledgements

We thank Christian Grootaert for initiating this work and for helpful suggestions. The ArstauthorthankstheUniversity of Wisconsinand JohnD. and Catherine T. MacArthur Foundation. The second author thanks the Economic and Social Research Council (UK) for its support. The work is part of the programme of the ESRC Global Poverty Research Group.

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