Social economics and social capital

Abstract

If you would like to write for this, or any other Emerald publication, then please use our Emerald for Authors service information about how to choose which publication to write for and submission guidelines are available for all. Please visit www.emeraldinsight.com/authors for more information. About Emerald www.emeraldinsight.comEmerald is a global publisher linking research and practice to the benefit of society. The company manages a portfolio of more than 290 journals and over 2,350 books and book series volumes, as well as providing an extensive range of online products and additional customer resources and services.Emerald is both COUNTER 4 and TRANSFER compliant. The organization is a partner of the Committee on Publication Ethics (COPE) and also works with Portico and the LOCKSS initiative for digital archive preservation.Abstract This paper evaluates key developments in the social capital literature over the past decade. It then examines empirical work on the purported the link between social capital and economic performance. Although these results indicate that good governance and social cohesion make a measurable contribution to economic development, the offer little guidance for policy formulation. Early contributors to the social capital field were pessimistic about the ability of the state to stimulate social capital formation. More recently, there has been a groundswell of interest in the application of community development principles to foster social capital at the micro level. This paper incorporates a critical evaluation of the mainstream social capital literature from a social economics perspective. The various strands within the social economics tradition share a common concern with the "disembedding" of social context from mainstream economics.What is good, Phaedrus, and what is not good . . . need we ask anyone to tell us these things? (Pirsig, 1975).

The Relation between Social Capital, Governance and Economic Performance in Europe

“…Social capital lowers uncertainty and transaction costs [3,5,19]. Economic agents in higher-trust societies spend less to protect themselves from being exploited in economic transactions.…”

“…The capacity of communities to benefit from and maintain social capital depends to some extent on the capacity of the governance to mitigate the effects of market failures, enforce the rule of law, and uphold civil liberties and political rights [3].…”

“…The Putnam's instrument has been severely criticized. Firstly due to the fact, that this instrument ignores the intensity of association members contacts, secondly, due to the positive and negative externalities of group membership [3].…”

“…The trust and cooperation in community depend on political, legal, and institutional environment. Transaction costs will be mitigated in high trust societies, because less explicit contracts will be required and fewer infringements will occur [3]. Whether an agent trusts another one heavily depends on whether there exist personal contacts between them, or whether there exist intermediary persons, who can, from their own knowledge, assure that the other agent is trustworthy.…”

“…In order to be able to set mutual goals, and cooperate for achieving them, people have to trust each other and their governmental institutions, which in turn have to ensure the environment, favorable for such cooperation. Due to this rationale there has been a growing consensus among researchers, that social capital is comprised of civil and governmental components [3].…”