Introduction
Social capital represents one of the most powerful and popular metaphors in current social science research. Broadly understood as referring to the community relations that affect personal interactions, social capital has been used to explain an immense range of phenomena, ranging from voting patterns to health to the economic success of countries.
Literally hundreds of papers have appeared throughout the social science literature arguing that social capital matters in understanding individual and group differences and further that successful public policy design needs to account for the effects of policy on social capital formation.This chapter is designed to survey research on social capital. We will give primary focus to the role of social capital in economic growth and development as suggested by the presence of this chapter in the Handbook of Economic Growth. That being said, this survey will discuss social capital in general as there is no part of the social capital literature that may plausibly be treated as orthogonal to the issues that arise in relating social capital to economic growth. Our objectives are threefold. First, we provide an overview of conceptual issues that underlie social capital studies. Second, we identify some general flaws we see in the empirical social capital literature. While we would hardly claim that every social capital study suffers from these problems, we do claim that they are prevalent in the literature. Third, we make a number of recommendations on how to strengthen the social capital literature. In assessing empirical work, we will focus almost exclusively on statistical analysis of social capital. This is not because we regard qualitative studies as unimportant (we will in fact advocate their greater use in the course of our discussion) but because such studies raise very distinct conceptual and interpretative questions from their quantitative counterparts.
Much of our discussion is critical.
We argue that empirical social capital studies are often flawed and make claims that are in excess of what is justified by the statistical exercises reported. However, this should not be taken as an indictment of research on social capital per se. In our judgment the role of social factors in individual and group outcomes is of fundamental importance in most of the contexts in which social capital has been studied. Hence we regard the empirical social capital literature as addressing major outstanding issues in many areas of social science. Our intent in this survey is to evaluate what is currently known and to make suggestions on how to improve future research.The chapter is organized as follows. Section 2 contains a discussion of how economists and other social scientists have attempted to define social capital. The section also reviews some of the contexts in which social capital has been argued to play an important causal role in various sociological outcomes. Section 3 discusses efforts to theorize about social capital; both heuristic and conceptual arguments are discussed as well as formal analyses. Section 4 discusses econometric issues that arise in the efforts to develop empirical evidence of the role of social capital as a determinant of socioeconomic outcomes. Section 5 reviews the empirical literature on social capital; while this literature is far too large to cover comprehensively we believe our survey captures the range of contexts in which social capital effects have been evaluated. Section 6 reviews empirical studies that analyze the determinants of social capital. Section 7 contains some suggestions for improving social capital research. Section 8 concludes.
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