Social Capital and Natural Resource Management

An important role for social capital?

TRISTAN CLARIDGE

B.A. University of Queensland

A thesis submitted in partial fulfillment of the requirement for the

Degree of Master of Natural Resource Studies, School of

Natural and Rural Systems Management, University of

Queensland

July 2004

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Declaration

Declaration The work presented in this thesis is, to the best of my

knowledge and belief, original and my own work, except as

acknowledged in the text, and the material has not been

submitted, either in whole or in part, for a degree at this or

any other university.

………………………………………

Tristan Claridge

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Acknowledgements

I would like to express my sincere appreciation to a number of

people who helped me in the development and completion of this

thesis. Particularly I would like to emphasize the importance of the

support and guidance given by my supervisor, Ken Keith. I would

also like to thank Geoff Woolcock, David Ip and Geoff Lawrence

for their time and assistance. Finally I would like to thank CL

Claridge, Megan Claridge and the rest of my family for their

patience and loving support.

Acknowledgements

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Abstract

The appeal of social capital stems from its intriguing integration of sociology and economics

that some authors have heralded as a very important conceptual innovation or inter and trans

disciplinary theoretical integration. Although the term social capital is relatively new, the

concept is not as it encompasses a variety of other concepts. Broadly, definitions of social

capital include reference to social networks and the productive benefits stemming from them.

There has been an unprecedented acceptance and application of the concept in recent years

with authors from a variety of disciplines applying it to numerous applications. The authors

commonly cited as the source of the contemporary debate are Pieere Bourdieu, James

Coleman and Robert Putnam. Of these, Putnam is commonly cited for popularizing social

capital. The speed of the terms application following Putnam’s early work has weakened the

theoretical rigor of the concept, leading many authors to question the validity of the concept.

As identified by Wendy Stone, the supply of tools for empirical measurement outstrips

demand. What is clear from the literature is that social capital is in a relatively early stage of

theorization and much work is required to obtain validity of both conceptualization and

operationalization.

The major focus of this thesis is to develop a more rigorous conceptualization of social capital.

To do this, an extensive review of literature on social capital was undertaken including work

from disciplines including sociology, economics, political science, and anthropology. This

review provided the basis for the new conceptualization of social capital that incorporated

current social capital theory and identified gaps and deficiencies. One of the major

deficiencies of current social capital theory is that it does not sufficiently take into account the

complexity of social capital, particularly in terms of level and structure. The conceptualization

designed for the purposes of this study incorporates the relationships between determinants,

structural elements and manifestations and considers the complexity in terms of externalities,

chance, level, feedback loops and specific context. Social capital involves a complex

interaction of space and time and as such, highlights the importance of an event as a major

determinant. This has significant consequences for a range of circumstances in relation to

building efforts and in minimizing loss. The conceptualization also highlights the importance

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of building and measuring attempts focusing on different aspects of social capital. Social

capital is highly context specific and involves a dynamic relationship between its structural

elements that fluctuate widely on spatial and temporal scales. The importance of specific

context is further highlighted by the fact that the structure and consequences of social capital

are not highly correlated; similar structures can have very different manifestations. These

findings contribute considerably to the current theoretical understanding of social capital

however there is still considerable work required to make social capital a usable and

appropriate concept.

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Table of Contents

DECLARATION................................................................................................................... 1

ACKNOWLEDGEMENTS .................................................................................................. 2

ABSTRACT........................................................................................................................... 3

TABLE OF CONTENTS ...................................................................................................... 5

LIST OF FIGURES............................................................................................................... 7

LIST OF TABLES................................................................................................................. 8

1.0 INTRODUCTION ...................................................................................................... 9

1.1 THESIS ORGANIZATION.................................................................................................. 13

2.0 LITERATURE REVIEW – SOCIAL CAPITAL.................................................... 14

2.1 EVOLUTION OF THE CONCEPT OF SOCIAL CAPITAL......................................................... 14

2.2 CONTEMPORARY AUTHORS ON SOCIAL CAPITAL............................................................ 18

2.3 DEFINITION OF SOCIAL CAPITAL.................................................................................... 23

2.4 IS SOCIAL CAPITAL REALLY ‘CAPITAL’? ....................................................................... 27

2.5 SOCIAL CAPITAL THEORY ............................................................................................. 30

2.5.1 Dimensions of Social Capital................................................................................. 30

2.5.2 Levels at Which Social Capital is Located.............................................................. 32

2.5.3 Types of Social Capital .......................................................................................... 34

2.5.4 Determinants of Social Capital .............................................................................. 35

2.5.5 Benefits and Importance of Social Capital ............................................................. 36

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2.5.6 Disadvantages / Downsides of Social Capital ........................................................ 37

2.6 CONCEPTUALIZATION ................................................................................................... 38

2.6.1 Problems with Conceptualization of Social Capital................................................ 38

2.6.2 Social Capital Conceptualization Approaches ....................................................... 41

Communitarian Approach ................................................................................................................ 42

Network Approach............................................................................................................................ 43

Institutional Approach ...................................................................................................................... 44

Synergy Approach ............................................................................................................................ 44

2.7 OPERATIONALIZATION .................................................................................................. 44

2.7.1 Measurement of Social Capital .............................................................................. 44

2.7.2 Building Social Capital.......................................................................................... 51

2.8 GENDER ISSUES IN SOCIAL CAPITAL THEORY ................................................................ 52

2.9 SOCIAL CAPITAL AND NATURAL RESOURCE MANAGEMENT ........................................... 52

2.10 SOCIAL CAPITAL LITERATURE REVIEW SUMMARY....................................................... 54

3.0 METHODOLOGY ................................................................................................... 56

4.0 RESULTS.................................................................................................................. 58

4.1 PRELIMINARY MEASUREMENT FRAMEWORK FOR APPLICATION TO NATURAL RESOURCE

MANAGEMENT .................................................................................................................... 58

4.2 CONCEPTUALIZATION OF SOCIAL CAPITAL .................................................................... 62

5.0 CONCLUSIONS....................................................................................................... 71

6.0 REFERENCES ......................................................................................................... 73

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List of Figures Figure 1. Adaptive research objectives showing change over time from A through to C. ....... 10

Figure 2. Change of objectives. ............................................................................................. 12

Figure 3. Citations with social capital, human capital and social networks in Econ Lit........... 15

Figure 4. Contemporary authors on social capital. ................................................................ 21

Figure 5. The dimensions of social capital defined by Narayan and Cassidy (2001). ............ 31

Figure 6. Four dimensions of social capital defined by Michael Woolcock (1998). ................. 32

Figure 7. Illustration of the interaction of levels at ................................................................. 33

Figure 8. Conceptualization of social capital developed by Grootaert and Van Bastelaer (2002)

....................................................................................................................................... 40

Figure 9. Conceptual Framework: Levels and Types of Social Capital ................................. 41

Figure 10. Putnam’s indicators of social capital for the United States .................................... 50

Figure 11. Levels at which social capital operates within natural resource management. ...... 61

Figure 12. Current attempts to conceptualize social capital do not sufficiently account for the

complexity between the determinants and consequences or outcomes of social capital. 62

Figure 13. The links between determinants, structural elements and consequences or

manifestations are currently not well understood and generally grossly oversimplified. .. 64

Figure 14. Conceptualization of social capital simplifying the complexity of the social world into

a diagram outlining relationships between determinants, structure (or elements) and

consequences. ............................................................................................................... 65

Figure 15. Norms of networks are likely to depreciate over time without reinforcement while

norms of membership and belonging are likely to increase over time. ............................ 67

Figure 16. Location of social capital at the individual level within the framework of micro level

social capital interactions................................................................................................ 70

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List of Tables

Table 1. Contemporary authors level of study of social capital ............................................. 19

Table 2. Definitions of social capital (Source: Adler and Kwon 2002) ................................... 25

Table 3. Four views of social capital (Source: Woolcock and Narayan 2000) ........................ 42

Table 4. Indicators of social capital (Source: Grootaert 2001)................................................ 48

Table 5. List of databases searched for social capital and results......................................... 57

Table 6. Core dimensions of social capital and their characteristics ...................................... 59

Table 7. Types of Informal and Formal Networks .................................................................. 60

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1.0 Introduction There has been considerable and increasing interest in social capital theory in recent years,

evidenced by its application to various disciplines and numerous subject areas. This interest

stems from the appeal of the concept as it integrates sociology and economics, and combines

a number of ideas including civic tradition, civicness, civic involvement and social cohesion.

Existing studies have suggested that social capital has considerable benefits for a range of

economic and sociological outcomes. These purported benefits, and the concept behind

social capital, are not new but rooted in the work of early economic and sociologic thinkers.

The contemporary authors, who are responsible for bringing the social capital debate to its

current popularity, include Pierre Bourdieu, James Coleman and Robert Putnam. Many

authors have since contributed to the rudimentary conceptualization of the complex theory.

There is no set and commonly agreed upon definition of social capital and the particular

definition adopted by a study will depend on the discipline and level of investigation. There is

still debate over the appropriateness of the term ‘capital’ and this has led to a general

weakening of the conceptualization. These definitional and ideological problems have

resulted in considerable diversity in theory, particularly in discussion of dimensions, levels,

types, determinants, benefits, and downsides. The result is a number of conceptualization

approaches, each attempting to simplify the complex social world while maintaining validity.

The result to date has largely been poor operationalization of the concept that lacks rigor and

strong theoretical links to a thorough conceptualization of social capital. Of particular interest

to this study is the interaction of social capital and natural resource management. Few

authors have previously made this connection with the most closely related work being on

environmental management and development.

This thesis involved an adaptive research approach which facilitated the process of

aim/objective clarification to ensure appropriate scope and application of social capital theory

(refer to figure 1 and 2). Originally, the aim was to identify effective mechanisms to minimize

social capital losses caused by change of institutional structure. The focus was on the

measurement of social capital in natural resource management. Literature on social capital

was investigated, particularly the measurement of social capital. Conclusions from the social

capital literature review (chapter 2) revealed that social capital is inherently abstract in nature

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and does not lend itself to meaningful or rigorous quantitative or qualitative measurement and

at present there is a tenuous link to the theoretical understanding of the concept. What was

immediately clear was that rigorous measurement of social capital would involve detailed

context specific conceptualization to enable the formulation of appropriate indices. This,

combined with the extensive data collection requirements, meant that measurement was

deemed beyond the scope of the study. For this reason the original objectives (A1-A3 in

figure 2) could not be met making the aim impossible to achieve. Subsequently, a new aim

and corresponding objectives were developed in line with literature review findings at that

time.

A. Social Capital Measurement in Natural Resource Management Aim: To identify effective mechanisms to minimize social capital losses caused by change of institutional structure. Objectives:

A1. To identify what mechanisms to minimize social capital losses were put in place by the LCMC prior to disbandment. A2. To evaluate how effective the mechanisms used were in minimizing social capital losses. A3. To identify mechanisms that would have been more appropriate in this situation for application in other similar circumstances.

B. Application of Social Capital to Natural Resource Management Aim: A comprehensive understanding of social capital and how it relates to natural resource management in Australia. Objectives

B1. To provide a synthesis of current social capital theory in terms of conceptualization and operationalization B2. To identify an appropriate preliminary framework for the measurement of social capital within natural resource management B3. To gain a greater understanding of how social capital theory relates to natural resource management outcomes in Australia B4. To assess the likely factors that result in change in social capital and how these changes impact the management of natural resources in group settings

C. Conceptualization of Social Capital Aim: A more rigorous conceptualization of social capital. Objectives

B1. To provide a synthesis of current social capital theory in terms of conceptualization and operationalization B2. To identify an appropriate preliminary framework for the measurement of social capital within natural resource management C1. To attempt a more appropriate conceptualization of social capital

Figure 1. Adaptive research objectives showing change over time from A through to C.

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Since measurement was not possible, the new aim and objectives identified at B in figure 1,

revolved around the application of social capital theory to natural resource management

outcomes. At this stage, the conceptualization problems associated with social capital were

not clear. Objective B1 was to provide a synthesis of current social capital theory in terms of

conceptualization and operationalization. It was anticipated that this would provide a suitable

platform for the application of the theory to natural resource management. To achieve this

objective a substantial literature review was conducted including over 400 references from a

variety of disciplines including sociology, economics, political science, and anthropology (refer

to chapter 2). The major finding was that the current conceptualization of social capital was

very poor and did not account for a range of factors that have considerable impact on both the

structural elements and the consequences or manifestations of social capital. A further finding

was that past social capital studies have been grossly compromised by the lack of

conceptualization. Not wishing to further contribute to this problem, it was concluded that the

application of social capital to natural resource management would require a more rigorous

conceptualization of social capital. For this reason, objectives B3 and B4 in figure 2 were not

completed.

The second objective (B2) was to identify an appropriate preliminary framework for the

measurement of social capital within natural resource management. This was completed by

analyzing current state of the art social capital measurement methodologies against the

current (and improved) conceptualizations of social capital theory (refer to chapter 4.1). The

major finding was that there are currently no suitable measurement methodologies. The

design of an appropriate methodology for application to natural resource management would

require a more rigorous conceptualization of social capital and would be necessarily based on

the specific context of its application.

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Figure 2. Change of objectives.

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The findings from the previous level B objectives strongly indicated the need for a more

appropriate conceptualization of social capital so this became a new aim and objective (C1 in

figure 2). This new conceptualization of social capital was based on the existing work

reviewed in the literature and on understanding gained through wider reading in the fields of

sociology and economics. Existing theory was incorporated and interactions graphically

illustrated (refer to figure 14) with gaps identified and filled. There were a number of findings

relating to the dynamic and context specific nature of social capital. This work represents a

number of important developments to our understanding of social capital. The final objectives

for this study are:

To provide a synthesis of current social capital theory in terms of conceptualization and

operationalization;

To identify an appropriate preliminary framework for the measurement of social capital

within natural resource management; and

To attempt a more appropriate conceptualization of social capital (refer to figure 2).

1.1 Thesis organization This thesis includes the following chapters: introduction, literature review, methodology,

results, conclusions and references. The aim and objectives of this study are identified in the

introduction above. Due to the theoretical nature of the thesis, an extensive review of

literature is included in chapter 2. The early evolution of the concept of social capital is

identified and the role of contemporary authors discussed. The next section of the literature

review chapter deals with the definitional problems of social capital, and is followed by a

discussion of whether social capital is really ‘capital’. Social capital theory is then reviewed

including the dimensions of social capital, the levels at which it is located, the types of social

capital, the determinants of social capital, the benefits and importance of social capital and the

disadvantages or downsides of social capital. The problems with the current

conceptualization of social capital and the current conceptual approaches are highlighted in

the subsequent section. The operationalization of social capital is discussed in the next

section, including both measurement and building. Following this, gender issues are

identified, then, a synthesis of social capital and natural resource management literature is

presented. A summary of the literature review concludes this chapter.

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Chapter 3 outlines the methods used in this thesis including the details of literature search and

review and the method used to develop the conceptualization. This is followed by the results

chapter which has two major foci: an appropriate measurement framework for application to

natural resource management; and the development of a more rigorous conceptualization of

social capital. This conceptualization section presents the findings and interpretations of

various relevant factors. Chapter 5 details the conclusions of the study and highlights the

need for further research to gain a greater understanding of the linkages between social

capital determinants, structural elements and consequences or manifestations and the

importance of these to natural resource management.

2.0 Literature Review – Social Capital 2.1 Evolution of the Concept of Social Capital Social capital is a term that is commonly used; however the concept is often poorly defined

and conceptualized. Social capital is an old concept but the term has only been coined fairly

recently (Bankston and Zhou 2002; Labonte 1999; Lazega and Pattison 2001; Portes and

Sensenbrenner 1993; Putnam 1995). Social capital is linked to concepts such as civil society

and social connectedness (Adam and Roncevic 2003). It is also linked to historical authors

such as Durkheim, Simmel, Marx and Weber among others and to theories such as social

exchange theory and psychological contract theory (Watson and Papamarcos 2002). The

modern development of the concept came from three key authors, Bourdieu, Coleman and

Putnam with many other authors contributing to the current multidisciplinary theory. Very

broadly, social capital refers to the social relationships between people that enable productive

outcomes (Szreter 2000). 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 2003). 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 1998).

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There has been exponential growth in references to social capital in academic literature in the

last 15 years (Aldridge et al. 2002; Halpern 2001) (refer to figure 3). This growth in research

and application to diverse areas represents an unprecedented acceptance, study and

application of this single concept (Adam and Roncevic 2003). Fine and Green (2000)

suggested that social theory is being rewritten through the lens of social capital. 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 2002b).

Figure 3. Citations with social capital, human capital and social networks in Econ Lit.

Source: Isham, Kelly et al (2002)

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 2003).

The idea is connected with thinkers such as Tocqueville, J.S. Mill, Toennies, Durkheim,

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Weber, Locke, Rousseau and Simmel (Bankston and Zhou 2002; Brewer 2003; Lazega and

Pattison 2001; Portes and Sensenbrenner 1993; Putnam 1995). Bankston and Zhou (2002)

made a particular reference to the connections between Durkheimian normative sociology and

Coleman’s thinking on the topic. This is supported by Portes and Landolt (1996) who believed

that the origins of the concept lie in the nineteenth century classics of sociology. Portes

pointed out Durkheims’ emphasis on group life as an antidote to anomie and self-destruction,

and to Marx’s distinction between an atomized class-in-itself and a mobilized and effective

class-for-itself (Portes 1998). Heffron (2000) made a tenuous link to the earliest human

societies which attempted to accumulate productive assets, thereby creating social capital.

Brewer (2003) 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 1916 however others have identified Jacobs (1961) (Felkins 2002), Loury (1977)

(Lappe et al. 1997; Leeder and Dominello 1999), and the Royal Commission on Canada’s

Economic Prospects (Schuller et al. 2000). L.J. Hanifan, a social reformer, in 1916 chose the

term social capital to refer to ‘goodwill, fellowship, mutual sympathy, and social intercourse

among a group of individuals and families’ (MacGillivray and Walker 2000; Smith and

Kulynych 2002; Winter 2000a; Woolcock and Narayan 2000). Routledge and Amsberg (2003)

identified that Hanifan used the term ‘capital’ specifically to highlight the importance of the

social structure to people with a business and economics perspective. Woolcock and

Nerayan (2000) provided a more detailed description of Hanifan’s work identifying that the

term was used in explaining the importance of community participation in enhancing school

performance, describing it as

‘those tangible substances [that] count for most in the daily lives of people: namely

good will, fellowship, sympathy and social intercourse among the individuals and

families who make up a social unit .. If [an individual comes] into contact with his

neighbor, and they with other neighbors, there will be an accumulation of social capital,

which may immediately satisfy his social needs and which may bear a social

potentiality sufficient to the substantial improvement of living conditions in the whole

community’ (cited in Woolcock and Narayan 2000, p. 227).

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Smith and Kulynych (2002) identified that the next use of the term was by Jane Jacobs (1961)

in a discussion of urban vitality. Woolcock and Narayan (2000) however, have identified a

team of Canadian urban sociologists, Seely, Sim, and Loosely (1956) and an exchange

theorist, Homans (1961) that predate Jacobs. Jacobs stated that ‘networks are cities’

irreplaceable social capital’ (cited in Woolcock 1998, p. 192). It seems that the next use of the

term was by Loury (1977) (Portes 1998; Woolcock and Narayan 2000) 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 2000).

Hofsteed (1980) is another author who studied the concept although did not use the term

social capital but did demonstrate the relevance of such modern values as individualism,

equality of opportunity, and ‘uncertainty avoidance’ for the generation of what we call social

capital (Heffron 2000).

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 2002a; Healy and Hampshire 2002).

The concept is similar or equivalent to civic tradition, civicness and civic involvement (Adam

and Roncevic 2003). 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 1993; Sampson et al. 1999). Boix and Posner (1998) 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 2001), and others draw links to Adam Smith

(Portes and Landolt 1996; Winter 2000a; Winter 2000b). Winter (2000) found commonality

between social capital theory and the questions posed by Adam Smith in The Theory of Moral

Sentiments (1976 [1759]). Knack (2002) identified Adam Smiths discussion of the potential

negative spillovers of group activities as an aspect of social capital debate. Adam Smith

states that when ‘people of the same trade’ meet ‘even for merriment and diversion’ the result

is often ‘a conspiracy against the public’ or ‘some contrivance to raise prices’ (cited in Knack

2002, p. 773).

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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.

2.2 Contemporary Authors on Social Capital The contemporary strain of literature dates back to the 1980’s and flows primarily from the

work of Pieere Bourdieu, James Coleman and Robert Putnam (Carroll and Stanfield 2003;

Lang and Hornburg 1998). Bourdieu is responsible for bringing the concept and term social

capital into present-day discussions. Adam and Roncevic (2003) cite the release of his well-

known book Distinction published in French in 1979 as the origination of the modern notion of

social capital. Bourdieu is categorized as a pure sociologist by Adam and Roncevic (2003).

Bourdieu’s definition of social capital could be described as ‘egocentric’ as it is considered in

the broader framework of symbolic capital and of critical theories of class societies (Wall et al.

1998). Bourdieu defines social capital as

‘the aggregate of the actual or potential resources which are linked to possession of a

durable network of more or less institutionalized relationships of mutual acquaintance

and recognition – or in other words, to membership in a group – which provides each

of its members with the backing of the collectivity-owned capital, a ‘credential’ which

entitles them to credit, in the various senses of the word’ (Bourdieu 1986, web page).

Bourdieu’s original work on social capital was analysed within the context of his critical theory

of society. This differed from the following normative approach of Putnam (1993) and

Coleman (1988), and the network based utilitarian approach of Burt (1998) and Lin (2001). Of

the three originating authors on social capital, Bourdieu’s work contains the least empirical

analysis with only fragments of reference to it (Adam and Roncevic 2003).

James Coleman, a sociologist with strong connections to economics through rational-choice

theory (Jackman and Miller 1998; Li et al. 2003; Schuller et al. 2000), draws together insights

from both sociology and economics in his definition of social capital:

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‘Social capital is defined by its function. It is not a single entity, but a variety of

different entities having two characteristics in common: they all consist of some aspect

of social structures, and they facilitate certain actions of actors – whether persons or

corporate actors – within the structure’ (Coleman 1988, p. S98).

Coleman’s work represents an important shift from Bourdieu’s individual outcomes (as well as

in network-based approaches) to outcomes for groups, organizations, institutions or societies

which represents a tentative shift from egocentric to sociocentric (refer to table 1) (Adam and

Roncevic 2003; Cusack 1999; McClenaghan 2000). Coleman also added that ‘like other

forms of capital, social capital is productive, making possible the achievement of certain ends

that would not be attainable in its absence’ (Coleman 1988). Most authors agree that social

capital is dealing with certain aspects of social structure that enable social action (Adam and

Roncevic 2003). Unlike Bourdieu, Coleman was extensively involved in empirical research

and formulation of indicators. Schuller, Baron et al. (2000) described the explanation of his

findings as post hoc and that his key contribution to the social capital debate lay in the

relatively straightforward way he outlines the concept. Coleman explores how the productive

nature of social capital might offset deficiencies in other capital such as human and cultural

capital (Teachman et al. 1997). Coleman extended the scope of the concept from Bourdieu’s

analysis of the elite to encompass the social relationships of non-elite groups (Schuller et al.

2000).

Table 1. Contemporary authors level of study of social capital

Levels of analysis Bourdieu Coleman Putnam

Individual / class faction • Titles / names • Friendships /

associations • Memberships • Citizenship

Family / community • Family size • Parents’ presence in the

home • Mother’s expectation of

child’s education • Family mobility • Church affiliation

Community / region • Memberships in voluntary organizations

• Voting participation • Newspaper readership

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Robert Putnam, a political scientist was responsible for popularizing the concept of social

capital through the study of civic engagement in Italy (Boggs 2001; Schuller et al. 2000).

Such was Coleman’s influence over the scholarly debate, Putnam cited Coleman’s

Foundations of Social Theory as a central source (Routledge and Amsberg 2003). Putnam

gave the following definition:

‘Social capital here refers to features of social organization, such as trust, norms, and

networks, that can improve the efficiency of society by facilitating coordinated actions’

(Putnam et al. 1993, web page).

In Making Democracy Work (Putnam et al. 1993) the authors explore the differences between

regional governance in the north and south of Italy, the explanatory variable being civic

community. The next of Putnam’s work focused on the decline in civic engagement in the

United States (Schuller et al. 2000). In Bowling Alone (Putnam 1995) Putnam identified a

general secular decline in levels of social capital as indicated by membership in voluntary

organizations (Schuller et al. 2000). This paper used the example of bowling as an activity

which used to be highly associational, representing not only recreational channels but also a

source of social interaction, a component of social capital (Putnam 1999; Putnam 2000). Like

Coleman, Putnam was extensively involved in empirical research and formulation of indicators

and was responsible for the development of the widely applied measure so-called ‘Putnam

instrument’ (Adam and Roncevic 2003; Paldam and Svendsen 2000). This instrument is the

best known and most widely applied measure that is an overly simplified version of his

elaborate index of ‘civicness’ that includes four indicators: trust in people and institutions,

norms of reciprocity, networks, and membership in voluntary associations (Adam and

Roncevic 2003). Putnam’s arguments have been criticized as circular and tautological –

simultaneously a cause and effect (Pope 2003; Portes 1998).

The authors discussed above; Bourdieu, Coleman and Putnam; are most commonly cited for

the basis of contemporary discussions on social capital. They represent early attempts to

identify and conceptualize this complex theory. Grootaert and Van Bastelaer (2002a)

suggested that the social capital model may currently be at the same early stage that human

capital theory was thirty or forty years ago. Many authors have since progressed our

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understanding, and particularly the suitable operationalization, of social capital (refer to figure

4).

Figure 4. Contemporary authors on social capital.

Building on work by Bourdieu, Loury and Coleman among others, Alejandro Portes (1996,

1998, 2000) defines social capital as ‘… the ability of actors to secure benefits through

membership in networks and other social structures’ (Portes 1998, p. 6). Portes and Landolt

(1996) identified the downsides of social capital and illustrate that earlier authors had focused

on the positive, beneficial effects of social interaction without taking into account the less

attractive features. Portes in later work also made contributions to the understanding of the

role of social capital in development (Portes and Landolt 2000).

Ronald Burt’s research approach is based on Bourdieu’s and Coleman’s work and focuses on

variables indicating the position of the individual inside social networks (Adam and Roncevic

2003). Burt focused on accessibility to embedded resources by measuring social capital in

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terms of network constraint (Lin et al. 2001b). More constraint means fewer structural holes

and because structural holes are the source of social capital, fewer structural holes result in

poorer social capital (Burt 1997; Burt 1998). This research approach is commonly known as

the network approach as it looks at network variables. Nan Lin, often working with Burt, has

contributed to the development of network measurements of social capital, namely position

generator and name generator (Lin et al. 2001a). Lin described three different research

programs: focus on the documentation of the distribution of resource in a social structure, with

the purpose of describing the relative distribution of resources as a collective asset in the

structure (Lin 1976; Lin 2001a; Lin 2001b).

Michael Foley and Bob Edwards (1997, 1999) produced some revealing findings from

studying the work of authors who undertook empirical research on social capital. Their

findings included context-dependent conceptualization of social capital, as access plus

resources, and that work on ‘generalized social trust’ are irrelevant. Francis Fukuyama used

an approach derived from Putnam that focuses mainly on behavioral variables and attitudes

(for example, trust, norms, values) as measured in various surveys (Adam and Roncevic

2003). Fukuyama practically equated social capital with trust. Other authors have criticized

the use of a single indicator as a measure of social capital (Paxton 1999). Stephen Knack

and Paul Keefer (1997) adopted two measures of social capital; the mean value of expressed

general trust and the second is a composite index of norms of civic cooperation. Pamela

Paxton (1999, p. 93) conceptualized social capital differently from preceding authors stating

‘social capital consists of two measurable components: objective associations between

individuals and a subjective type of tie, which must be reciprocal, trusting, and involving

positive emotions’. The first is measured by three variables and the second by trust in

individuals and trust in institutions (Paxton 1999).

In an attempt to alleviate the problems of source/form distinctions, Michael Woolcock

developed a comprehensive, multilevel model of social capital while taking into account the

well-known distinction between ‘bridging’ and ‘bonding’ social capital (Woolcock 1998;

Woolcock 2001a; Woolcock 2001b; Woolcock 2002b). Famous for his work with the World

Bank, Woolcock (1998) asserted that without bridging social capital, communities do not have

what is needed to ‘get ahead’ (Guenther and Falk 1999). Janine Nahapiet and Sumantra

Ghosal (1998) developed a robust definition of social capital with the distinction between three

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dimensions: structural, relational and cognitive, and discuss the highly interrelated nature of

the features they discuss.

By the late 1990’s the number of contributing authors grew significantly based on the work of

the contemporary authors discussed above. It could be generalized that much of this work

lacked rigor and did not take into account the multi-dimensional nature of social capital. Much

of the work was piece-meal in nature, simply applying an approach to a discipline or area of

interest. The role of Putnam’s research in this process was significant. Putnam’s work, while

popularizing the concept, led to a significant weakening of the conceptualization and

operationalization of the concept. Coleman’s earlier work provided a more thorough path

towards conceptualization and operationalization. Putnam however, applied a single proxy

analysis of social capital and applied it to good governance. Seen as the foremost expert on

social capital at the time, many authors followed in his footsteps, and Putnam’s lack of rigor

was replicated in piece-meal works across a variety of disciplines. Putnam is not solely to

blame for this situation, which is due mostly to the complexity and attractiveness of the

concept of social capital. The result was a plethora of definitions and operationalization of the

concept that led to the theory itself being questioned. From this work many recent authors

have synthesized a more rigorous framework for the conceptualization and operationalization

of the concept, but much work is left to be done if social capital theory is to provide a

meaningful contribution in all its facets.

2.3 Definition of Social Capital The commonalities of most definitions of social capital are that they focus on social relations

that have productive benefits. The variety of definitions identified in the literature stem from

the highly context specific nature of social capital and the complexity of its conceptualization

and operationalization.

Social capital does not have a clear, undisputed meaning, for substantive and ideological

reasons (Dolfsma and Dannreuther 2003; Foley and Edwards 1997). For this reason there is

no set and commonly agreed upon definition of social capital and the particular definition

adopted by a study will depend on the discipline and level of investigation (Robison et al.

2002). Not surprisingly considering the different frameworks for looking at social capital there

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is considerable disagreement and even contradiction in the definitions of social capital (Adler

and Kwon 2002). Because of the difficulties in defining social capital, authors tend to discuss

the concept, its intellectual origin, its diversity of applications and some of its unresolved

issues before adopting a school of thought and adding their own definition (Adam and

Roncevic 2003). It has been suggested that a cross disciplinary definition would be less

important if scholars were to redefine and appreciate other discipline’s definitions (SCIG

2000). SCIG (2000) further identified that all studies must discuss social capital in relation to

the particular discipline, study level and context and that a set definition for such is not

required, only an identification of operationalization or conceptualization (SCIG 2000). Other

authors have identified that definitions vary depending on whether they focus on the

substance, the sources, or the effects of social capital (Adler and Kwon 2002; Field et al.

2000; Robison et al. 2002). Grootaert and Van Bastelaer (2002b) supported this view

identifying that the main cause of variance in definitions is caused by focusing on the form,

source or consequence of social capital. Social capital is multidimensional and must be

conceptualized as such to have any explanatory value (Eastis 1998). Some authors see social

capital as an economic term and do not adequately take account of its multi – dimensional

and multi – disciplinary nature, for example Day (2002).

Social capital is about the value of social networks, bonding similar people and bridging

between diverse people, with norms of reciprocity (Dekker and Uslaner 2001; Uslaner 2001).

Sander (2002, p. 213) stated that ‘the folk wisdom that more people get their jobs from whom

they know, rather than what they know, turns out to be true’. Adler and Kwon (2002) identified

that the core intuition guiding social capital research is that the goodwill that others have

toward us is a valuable resource. As such they define social capital as ‘the goodwill available

to individuals or groups. Its source lies in the structure and content of the actor’s social

relations. Its effects flow from the information, influence, and solidarity it makes available to

the actor’ (Adler and Kwon 2002, p. 23). Dekker and Uslaner (2001) posited that social

capital is fundamentally about how people interact with each other.

There are therefore numerous definitions of social capital found in the literature. A

considerable number of definitions have been listed in the table below (adapted from Adler

and Kwon 2002). They vary depending on whether their focus is primarily on (1) the relations

an actor maintains with other actors, (2) the structure of relations among actors within a

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collectivity, or (3) both types of linkages (Adler and Kwon 2002). A focus on external relations

have also been called ‘bridging’ (Woolcock 1998) or ‘communal’ (Oh et al. 1999) and a focus

on internal relations ‘bonding’ or ‘linking’. Similar categorization could be done according to

other criteria such as strong or weak ties, horizontal or vertical, open or closed, structural or

cognitive, geographically dispersed or circumscribed, and instrumental or principled (further

discussion of these types and categorizations can be found in the types of social capital

section). In table 2 below the external definitions are those that focus primarily on the

relations as actors maintain with other actors the internal are those that focus on the structure

of relations among actors within a collectivity and both types of linkages (Adler and Kwon

2002).

Table 2. Definitions of social capital (Source: Adler and Kwon 2002)

External versus Internal Authors Definitions of Social Capital

Baker ‘a resource that actors derive from specific social structures and then use to pursue their interests; it is created by changes in the relationship among actors’ (Baker 1990, p. 619).

Belliveau, O'Reilly, & Wade

‘an individual's personal network and elite institutional affiliations’ (Belliveau et al. 1996, p. 1572).

Bourdieu ‘the aggregate of the actual or potential resources which are linked to possession of a durable network of more or less institutionalized relationships of mutual acquaintance or recognition’ (Bourdieu 1986, p. 248). ‘made up of social obligations ('connections'), which is convertible, in certain conditions, into economic capital and may be institutionalized in the form of a title of nobility’ (Bourdieu 1986, p. 243).

Bourdieu & Wacquant

‘the sum of the resources, actual or virtual, that accrue to an individual or a group by virtue of possessing a durable network of more or less institutionalized relationships of mutual acquaintance and recognition’ (Bourdieu and Wacquant 1992, p. 119).

External/ Bridging/ Communal

Boxman, De Graai. & Flap

‘the number of people who can be expected to provide support and the resources those people have at their disposal’ (Boxman et al. 1991, p. 52).

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Burt ‘friends, colleagues, and more general contacts through whom you receive opportunities to use your financial and human capital’ (Burt 1992, p. 9). ‘the brokerage opportunities in a network’ (Burt 1997, p. 355).

Knoke ‘the process by which social actors create and mobilize their network connections within and between organizations to gain access to other social actors' resources’ (Knoke 1999, p. 18).

Portes ‘the ability of actors to secure benefits by virtue of membership in social networks or other social structures’ (Portes 1998, p. 6).

Brehm & Rahn ‘the web of cooperative relationships between citizens that facilitate resolution of collective action problems’ (Brehm and Rahn 1997, p. 999).

Coleman ‘Social capital is defined by its function. It is not a single entity, but a variety of different entities having two characteristics in common: They all consist of some aspect of social structure, and they facilitate certain actions of individuals who are within the structure’ (Coleman 1990, p. 302).

Fukuyama ‘the ability of people to work together for common purposes in groups and organizations’ (Fukuyama 1995, p. 10). ‘Social capital can be defined simply as the existence of a certain set of informal values or norms shared among members of a group that permit cooperation among them’ (Fukuyama 1997).

Inglehart ‘a culture of trust and tolerance, in which extensive networks of voluntary associations emerge’ (Inglehart 1997, p. 188).

Portes & Sensenbrenner

‘those expectations for action within a collectivity that affect the economic goals and goal seeking behavior of its members, even if these expectations are not oriented toward the economic sphere’ (Portes and Sensenbrenner 1993, p. 1323).

Putnam ‘features of social organization such as networks, norms, and social trust that facilitate coordination and cooperation for mutual benefit’ (Putnam 1995, p. 67).

Internal/ Bonding/ Linking

Thomas ‘those voluntary means and processes developed within civil society which promote development for the collective whole’ (Thomas 1996, p. 11).

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Loury ‘naturally occurring social relationships among persons which promote or assist the acquisition of skills and traits valued in the marketplace. . . an asset which may be as significant as financial bequests in accounting for the maintenance of inequality in our society’ (Loury 1992, p. 100).

Nahapiet & Ghoshal

‘the sum of the actual and potential resources embedded within, available through, and derived from the network of relationships possessed by an individual or social unit. Social capital thus comprises both the network and the assets that may be mobilized through that network’ (Nahapiet and Ghoshal 1998, p. 243).

Pennar ‘the web of social relationships that influences individual behavior and thereby affects economic growth’ (Pennar 1997, p. 154).

Schiff ‘the set of elements of the social structure that affects relations among people and are inputs or arguments of the production and/or utility function’ (Schiff 1992, p. 160).

Both types

Woolcock ‘the information, trust, and norms of reciprocity inhering in one's social networks’ (Woolcock 1998, p. 153).

As previously identified, all studies must discuss social capital in relation to the particular

discipline, study level, and context and that a set definition for such is not required, only an

identification of operationalization or conceptualization. Therefore this study will not create a

new definition of social capital and will not select an existing definition from the literature as

doing so limits the application and understanding of the concept. This study will identify an

appropriate operationalization and conceptualization for social capital in following sections.

The above discussion of definitions should provide ample understanding of the social capital

concept.

2.4 Is Social Capital Really ‘Capital’? There is considerable controversy in the literature over the use of the term ‘capital’ (Falk and

Kilpatrick 1999; Hofferth et al. 1999; Inkeles 2000; Lake and Huckfeldt 1998; Schmid 2000;

Smith and Kulynych 2002). Portes (1998) elegantly posited the location of capital in relation

to other forms of capital:

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‘whereas economic capital is in people’s bank accounts and human capital is inside

their heads, social capital inheres in the structure of their relationships’ (Portes 1998,

p. 7).

Social capital is similar to other forms of capital in that it can be invested with the expectation

of future returns (Adler and Kwon 1999), is appropriable (Coleman 1988), is convertible

(Bourdieu 1986), and requires maintenance (Gant et al. 2002). Social capital is different from

other forms of capital in that it resides in social relationships whereas other forms of capital

can reside in the individual (Robison et al. 2002). Further, social capital cannot be traded by

individuals on an open market like other forms of capital, but is instead embedded within a

group (Gant et al. 2002; Glaeser et al. 2002). It is clear from the literature that social capital

has both similarities and dissimilarities with neocapital theories and is certainly quite dissimilar

from classical theory of capital.

To discuss this in more detail it is necessary to further identify the characteristics of ‘capital’.

Schmid (2000) identified that capital is not immediately used up in production but rather its’

services extend over time. The capital stock is subject to investment for future production and

depreciation and decay from both use and non-use. Piazza-Georgi (2002) states that capital

produces income and encompasses the non-consumable, but depreciating, inputs into the

production process. The author supported Schmid (2000a) stating that capital is a productive

resource that is the result of investment (Piazza-Georgi 2002). Castle (2002) adds that other

characteristics of capital are usefulness and durability.

Many authors have questioned and even attacked the appropriateness of the term capital in

social capital. If social capital is adherence to a norm and not affected by individual action as

Fukuyama (1995) suggests, then it is not capital in the above sense. The main difference is

that more than one person benefits from social capital (Schmid 2002; Schmid 2000). Smith

and Kulynych (2002) believed that the word capital has a too broad, pervasive and honorific

meaning and that the term blurs many distinctions which adversely affects the scholarly

inquiry, whatever its implicit or explicit normative concerns. Inkeles (2000, p. 20) suggested

that the term capital is too limiting and would rather use the term social or communal

resources. The author argued this on the basis of:

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‘capital being an element of production, in particular the production of goods, but also

services. We want not only goods and serves but also social support, physical and

social security, freedom of expression, opportunities to develop ourselves and a host

of these outcomes not captured by the idea of goods and services’.

Hofferth, Boisjoly et al (1999) suggested that social capital is the result of altruism and

therefore not capital as capital is a resource that is built up through investment and can be

drawn upon when needed. Lin, Cook et al (2001) disagreed by identifying that social capital

shares commonalities with other forms of capital, notably human capital. SCIG (2000)

supported Lin, concluding that the consequences of social capital are capital in nature

because capital suggests something that is durable or long lasting and suggests something

that retains its identity even after repeated use, something that can be used up, destroyed,

maintained, or improved.

Many authors identify that both forms of social capital, structural and cognitive, qualify as

capital because they both require some investment – of time and effort if not always of money

(Grootaert 2001; Grootaert and Van Bastelaer 2002b; Krishna and Uphoff 2002). It can be

concluded that social capital is unlike other forms of capital but also not sufficiently dissimilar

to warrant a different term. Certainly it is the use of the term capital that makes the concept

attractive to such a wide range of people given the bringing together of sociology and

economics (Adam and Roncevic 2003). Perhaps a more appropriate term may be social

solidarity as the notion connotes relations of trust, co-operation and reciprocity just as much

as social capital and might be used in place of it to overcome the problem identified above

with using the term capital.

It is interesting that the term capital should be used with social, considering capital is already a

social relation. In the original sense of the word capital, an object is only capital under

particular social conditions. In the same way the sources of social capital are only capital

under particular social conditions. For example, a favor owed is only capital under certain, not

necessarily favorable conditions. This idea brings in the notion of negative or perverse social

capital (see negative social capital section).

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2.5 Social Capital Theory Social capital theory is incredibly complex with researchers and practitioners approaching it

from various disciplines and backgrounds for various applications. The result is considerable

diversity, controversy and disagreement surrounding the theory. This section will discuss the

following components of the theory: dimensions, levels, types, determinants, benefits, and

downsides.

2.5.1 Dimensions of Social Capital As previously identified, social capital theory suffers from much criticism for being poorly

defined and conceptualized. This problem largely stems form the fact that social capital is

multi-dimensional with each dimension contributing to the meaning of social capital although

each alone is not able to capture fully the concept in its entirety (Hean et al. 2003). The main

dimensions are commonly seen as:

Trust (Coleman 1988; Collier 1998; Cox 1997; Kawachi et al. 1999a; Kilpatrick 2000;

Leana and Van Buren III 1999; Lemmel 2001; Putnam 1993; Putnam et al. 1993;

Snijders 1999; Welsh and Pringle 2001)

Rules and norms governing social action (Coleman 1988; Collier 1998; Fukuyama

2001; Portes and Sensenbrenner 1993)

Types of social interaction (Collier 1998; Snijders 1999)

Network resources (ABS 2002; Kilpatrick 2000; Snijders 1999)

Other network characteristics (Burt 1997; Hawe and Shielle 2000; Kilpatrick 2000;

Putnam 1995) adapted from (Hean et al. 2003, p. 1062).

Other authors have identified different groups of dimensions, for example Liu and Besser

(2003) identified four dimensions of social capital: informal social ties, formal social ties, trust,

and norms of collective action. Narayan and Cassidy (2001) identify a range of dimensions

illustrated in figure 5.

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Figure 5. The dimensions of social capital defined by Narayan and Cassidy (2001).

Source: Narayan and Cassidy (2001).

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Piazza-Georgi (2002) posited that Woolcock (1998) was the first to attempt a dissection of the

concept of social capital within a unified conceptual framework. She goes on to state that

Woolcock does this by defining four dimensions of social capital, in two pairs of opposing

concepts: embeddedness and autonomy, and the macro and the micro level (refer to figure 6).

Figure 6. Four dimensions of social capital defined by Michael Woolcock (1998).

Source: Woolcock (1998)

Analysis by Onyx and Bullen (2001) suggested that there are eight distinct dimensions of

social capital; many are related to each other. Uslaner and Dekker (2001) sum this discussion

up by identifying that it is clear that the components of social capital need to be treated as

multi-dimensional rather than one-dimensional.

2.5.2 Levels at Which Social Capital is Located Further to dimensional problems, social capital has been located at the level of the individual,

the informal social group, the formal organization, the community, the ethnic group and even

the nation (Bankston and Zhou 2002; Coleman 1988; Portes 1998; Putnam 1995; Sampson et

al. 1999). There are divergent views in the literature; some authors posit social capital at the

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individual level, some the community level and others have a more dynamic view. Kilby

(2002) stated that social capital exists within levels or scales as one feels belonging to family,

community, profession, country, etc, simultaneously. Adler and Kwon (2002) supported this

stating that social capital’s sources lie in the social structure within which the actor is located.

Thus, social capital can be thought of as having an individual and an aggregate component

(Buys and Bow 2002; Newton 1997; Slangen et al. 2003). That is, social capital belongs to

the group and can be used by the group or individuals within the group (Kilpatrick et al. 1998;

Sander 2002).

Brewer (2003) stated that although social capital was originally conceived as a community-

wide concept, it should be observable at the individual level. Baum and Ziersch (2003)

disagreed with this, identifying that Bourdieu identified it at the individual level and that

Putnam since at the community level. Coleman argued that social capital is not an attribute of

individuals but a context-dependent aspect of social structure (Hogan and Owen 2000;

Robinson 2000). Glaeser, Laibson et al (2002) identified that post-Coleman literature has

almost universally viewed social capital as a community-level attribute. Social capital and civil

society are essentially social and collective property of social systems, not a characteristic of

individuals (Newton 2001). The key empirical difference between human and social capital is

that social capital inheres in relations between individuals and groups, not in individuals per se

(Edwards and Foley 1998). The general consensus in the literature is that social capital is

identifiable from the individual level

to the level of the nation however it

is clear that social capital is evident

at any level where there is

identification and belonging. The

classification into micro

(individual), meso (group) and

macro (societal) is useful in

analysis of social capital (refer to

figure 7).

Figure 7. Illustration of the interaction of levels at

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which social capital exists.

The goods produced by social capital can also occur at different levels of the social structure

(Paxton 1999). It can be a private good or a public good depending on the level (Aldridge et

al. 2002). Onyx and Bullen (2001) supported this identifying that social capital appears to be

both a private and a public good. There is not consensus in the literature however. Coleman

(1988) argued that social capital is a public good, however Fukuyama posited that it is in fact

a private good (Fukuyama 2001; Fukuyama 2002). Fukuyama (2002) suggested that social

capital is not a public good but a private good that produces extensive positive and negative

externalities. This is supported by Dasgupta (1999, p. 325) who stated that ‘social capital is a

private good that is nonetheless pervaded by externalities, both positive and negative’.

2.5.3 Types of Social Capital Attempts to more thoroughly conceptualize social capital have resulted in many authors

identifying different types and characteristics, the most common being the distinction of

structural and cognitive, and bonding and bridging. Although not always called the same

thing, the distinction between bridging and bonding (and often linking as well) is common in

the literature. Aldridge, Halpern et al (2002) identified these main types of social capital.

Bonding is horizontal, among equals within a community whereas bridging is vertical between

communities (Dolfsma and Dannreuther 2003; Narayan 2002; Narayan and Pritchett 1999).

Wallis (1998) and Wallis and Crocker et al (1998) referred to bonding capital as localized

which he defined as being found among people who live in the same or adjacent communities,

and bridging capital, which extends to individuals and organizations that are more removed.

Bridging social capital is closely related to thin trust, as opposed to the bonding (splitting)

social capital of thick trust (Anheier and Kendall 2002).

The other important distinction of social capital, developed by Norman Uphoff and Wijayaratna

(2000) spans the range from structural manifestations of social capital to cognitive ones

(Grootaert and Van Bastelaer 2002a). Structural social capital facilitates mutually beneficial

collective action through established roles and social networks supplemented by rules,

procedures and precedents (Hitt et al. 2002). Cognitive social capital, which includes shared

norms, values, attitudes, and beliefs, predisposes people towards mutually beneficial

collective action (Krishna and Uphoff 2002; Uphoff 1999). Cognitive and structural forms of

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social capital are commonly connected and mutually reinforcing (Uphoff and Wijayaratna

2000).

There are numerous other examples in the literature; for example, whether its ties are strong

(intensive and repeated) or weak (temporary and contingent); vertical (operating through

formal hierarchical structures) or horizontal (in which authority is more decentralized); open

(civically engaged and exercising open membership) or closed (protective and exercising

closed membership); geographically dispersed or circumscribed; and instrumental

(membership as social collateral for individual wants) or principled (membership as bounded

solidarity) (Heffron 2000). These varieties of types of social capital require further exploration

to establish a widely agreed upon framework, vital for empirical analysis (Van Deth 2003).

2.5.4 Determinants of Social Capital The determinants are numerous and varied and there is both a lack of consensus and a lack

of evidence to support the propositions. Several influential studies have suggested that social

capital’s roots are buried in centuries of cultural evolution (Fukuyama 1995; Putnam et al.

1993). Other investigators suggest that social capital can be created in the short term to

support political and economic development (Brown and Ashman 1996; Fox 1994; Tendler

and Freedheim 1994). Aldridge, Halpern et al (2002) suggested that the main determinants of

social capital include: history and culture; whether social structures are flat or hierarchical; the

family; education; the built environment; residential mobility; economic inequalities and social

class; the strength and characteristics of civil society; and patterns of individual consumption

and personal values. Pantoja (1999) identified a different set again, including: family and

kinship connections; wider social networks of associational life covers the full range of formal

and informal horizontal arrangements; networks; political society; institutional and policy

framework which includes the formal rules and norms that regulate public life; and social

norms and values. The majority of these claims originate in applied theory and stem from

much work done on other concepts such as network analysis, civic society, cultural studies,

education, psychology, and many others. Even where empirical research has been

performed, the findings have questionable validity.

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2.5.5 Benefits and Importance of Social Capital The importance of social capital theory is apparent from the literature with many empirical

studies that purport to show the importance of social capital to a very wide-ranging set of

socioeconomic phenomena (Durlauf 2002a; Krishna 2001). Adam and Roncevic (2003, p.

177) stated that

‘despite problems with its definition as well as its operationalization, and despite its

(almost) metaphorical character, social capital has facilitated a series of very important

empirical investigations and theoretical debates which have stimulated reconsideration

of the significance of human relations, of networks, of organizational forms for the

quality of life and of developmental performance’.

The widespread interest in and application of the concept could suggest the theoretical

importance of social capital theory. Existing studies have provided ample evidence of its

pervasiveness and offered useful impressions of its political, economic and social influence

(Fine 2001; Jack and Jordan 1999; Montgomery 2000). Aldridge, Halpern et al (2002)

cautioned that some of the empirical evidence on the importance of social capital for

economic and social outcomes needs to be treated with caution because of the mis-

specification or ambiguity of equations or models used to estimate its impact. Without a

rigorous method for measurement it is unclear how the benefits are ascertained and tested. It

is surprising that there is little skepticism in the literature over the validity of the purported

benefits of social capital given the uncertainty of measurement techniques identified above.

This is due to two factors: the intrinsic appeal of the concept; and the common misguided faith

in measurement methodologies. The majority of benefits described in the literature have not

been empirically tested at all but arise through theoretical extrapolation based on other

concepts.

Requena (2003) suggested that the importance of social capital lies in that it brings together

several important sociological concepts such as social support, integration and social

cohesion. This view is supported by Rothstein (2003) who stated that the real strength of

social capital theory is the combination of macro-sociological historical structures with micro-

level causal mechanisms, a rare feature in the social sciences.

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The literature recognizes social capital as important to the efficient functioning of modern

economies, and stable liberal democracy (Fukuyama 2001; Kenworthy 1997), as an important

base for cooperation across sector and power differences, and an important product of such

cooperation (Brown and Ashman 1996), and Lyon (2000) described the importance of social

capital in shaping regional development patterns. It is clear that social capital is of importance

in societal wellbeing. Some aspects of the concept, such as inter-personal trust, are clearly

desirable in themselves while other aspects are more instrumental (Bankston and Zhou 2002).

Optimism, satisfaction with life, perceptions of government institutions and political

involvement all stem from the fundamental dimensions of social capital (Narayan and Cassidy

2001).

Social capital is charged with a range of potential beneficial effects including: facilitation of

higher levels of, and growth in, gross domestic product (GDP); facilitation of more efficient

functioning of labor markets; lower levels of crime; and improvements in the effectiveness of

institutions of government (Aldridge et al. 2002; Halpern 2001; Kawachi et al. 1999b; Putnam

et al. 1993). Social capital is an important variable in educational attainment (Aldridge et al.

2002; Israel et al. 2001), public health (Coulthard et al. 2001; Subramanian et al. 2003),

community governance, and economic problems (Bowles and Gintis 2002), and is also an

important element in production (Day 2002). Economic and business performance at both the

national and sub-national level is also affected by social capital (Aldridge et al. 2002). Others

have emphasized the importance of social capital for problem solving and how only certain

types of social capital contribute to this (Boyte, 1995; Sirianni & Friedland, 1997).

2.5.6 Disadvantages / Downsides of Social Capital The same characteristics of social capital that enable beneficial, productive benefits have the

potential to cause negative externalities. Potential downsides of social capital include:

fostering behavior that worsens rather than improves economic performance; acting as a

barrier to social inclusion and social mobility; dividing rather than uniting communities or

societies; facilitating rather than reducing crime, education underachievement and health-

damaging behavior. (Aldridge et al. 2002). The same orchestrating mechanisms that reduce

transaction costs in market exchange can have negative consequences (Carroll and Stanfield

2003; Fine 1999; Torpe 2003). Erickson (2002, p. 547) supports this identifying the following

paradox: ‘every feature of social structure can be social capital in the sense that it produces

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desired outcomes, but also can be a liability in the sense that it produces unwanted results’.

The kinds of groupings and associations which can generate social capital always also carry

the potential to exclude others (Hunter 2000; Morrow 1999; Szreter 2000). Social capital can

become a constraint to individuals’ actions and choices (Wall et al. 1998). For example, there

is a particularly high risk of negative social capital in urban poverty situations (Small 2002).

The importance of the negatives of social capital was first documented by Portes (1996) but

now is synonymous with our understanding of social capital theory. A stock of social capital is

simultaneously productive and perverse. Simplistically speaking, the make up of these types

determines the structure of the overall social capital present. As this is highly context specific

further research is required to understand the causal relationships that determine the

realization of productive, or perverse, social capital.

2.6 Conceptualization 2.6.1 Problems with Conceptualization of Social Capital As identified above, the conceptualization of social capital is the biggest challenge facing

proponents of the theory. At present there is a lack of rigorous conceptualization of social

capital (Krishna and Uphoff 2002). Lin, Cook et al (2001, p. 58) identified that there is a

‘danger that we may reach a point where the term might be used in whatever way it suits the

purpose at hand, and thus be rendered meaningless as a scientific concept that must meet

the rigorous demands of theoretical and research validity and reliability’. Fine (1999) pointed

out that social capital is taking over explanations of economic development, growth, and

prosperity, he also suggest that social capital had other possibilities before being turned

against the other social sciences by economics (Fevre 2000). Hean, Cowley et al (2003)

made the observation that the accumulation of literature on social capital has begun to

obscure the understanding of the concept. The inappropriate measurement techniques that

have been implemented have caused problems for understanding social capital at the

conceptual level and led to debate over whether the concept is relevant or appropriate (Stone

2001). Or as McHugh and Prasetyo (2002, p. 1) put it, ‘the proliferation of competing

definitions, analytical methods and applications associated with the term is perhaps only

dwarfed in volume by the literature critical of its theoretical ambiguity, ambitious conceptual

scope, and practical over-versatility’.

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Glaeser, Laibson et al (2002) were very positive that economics will solve and answer

problems with social capital theory, however Fukuyama (2001) was of the view that the

economists’ approach to understanding how social capital is generated is ultimately very

limited. Good (2000) posited that social capital theory will develop over time through debate

to be more usable and measurable.

Collier (1998) provided a good starting point for conceptualization, identifying that a

conceptual model for social capital should identify the concept within the complexity of the

social world, as defined by dynamic relationships between its components, rather than what at

present often appears to be a disparate collection of circumstantial variables. Perhaps many

authors struggle with the complexity of the concept, and there is some evidence that this is the

case. Paxton (1999) identified the complexity of social capital framework in terms of micro

(individual), meso (group), and macro (societal) scales with the interaction of negative

externalities in the form of exclusion and negative ends such as crime. Fukuyama (2001)

posited that many of the characteristics of social capital are epiphenomenal, arising as a result

of social capital but not constituting social capital itself. Edwards and Foley (1998) added to

the complexity identifying that norms and values held by individuals become social capital only

insofar as they facilitate action by others and in this respect, they are context specific; outside

that situation they may be of little or no value. Another important factor is the distinction

between two mechanisms through which actors pursue social capital, reciprocity transactions

and enforceable trust, which are sustained by different norms and patterns of social ties

among actors (Frank and Yasumoto 1998; Portes and Sensenbrenner 1993). Not only is it

context specific and operates under different mechanisms, but each element bears different

functional relationships to the causal factors (Johnston and Soroka 2001).

Attempting to conceptualize the concept, Grootaert and Van Bastelaer (2002) building on the

work of Uphoff (2000) identify two important dimensions of social capital: level from micro to

macro; and the continuum from cognitive to structural (refer to figure 8).

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Figure 8. Conceptualization of social capital developed by Grootaert and Van Bastelaer (2002)

Source: Grootaert and Van Bastelaer (2002)

Figure 9 illustrates an existing conceptualization of social capital developed by Bain and Hicks

(1998). The authors roughly divide social capital into two levels: the macro and the micro. The

macro level refers to the institutional context in which organizations operate while the micro

level refers to the potential contribution that horizontal organizations and social networks

make to development (Bain and Hicks 1998).

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Figure 9. Conceptual Framework: Levels and Types of Social Capital

Adapted from: Bain and Hicks, 1998

2.6.2 Social Capital Conceptualization Approaches Woolcock and Narayan (2000) have identified four distinct approaches the research has

taken: communitarian, networks, institutional, and synergy (refer to table 3). The authors state

that ‘the evidence suggests that of the four, the synergy view, with its emphasis on

incorporating different levels and dimensions of social capital and its recognition of the

positive and negative outcomes that social capital can generate, has the greatest empirical

support and lends itself best to comprehensive and coherent policy prescriptions’ (Woolcock

Level of participation in policy process

Level of decentralization

Structural • Horizontal

organizational structure

• Collective/ transparent decision-making process

• Accountability of leaders

• Practices of collective action and responsibility

Micro

Macro

Cognitive

• Values Trust Solidarity Reciprocity

• Social norms • Behavior • Attitudes

Rule of law

Legal framework

Type of regime

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and Narayan 2000, p. 225). From the following discussion it can be seen that each approach

has things to offer for an appropriate conceptualization of social capital.

Table 3. Four views of social capital (Source: Woolcock and Narayan 2000)

Perspective Actors Policy prescriptions

Communitarian view

Local associations Community groups Voluntary organizations

Small is beautiful Recognize social assets of the poor

Network view

Bonding and bridging community ties

Entrepreneurs Business groups Information brokers

Decentralize Create enterprise zones Bridging social divides

Institutional view

Political and legal institutions Private and public sectors Grant civil and political liberties Institute transparency, accountability

Synergy view

Community networks and state-society relations

Community groups, civil society, firms, states

Coproduction, complementarily Participation, linkages Enhance capacity and scale of local organizations

Other authors describe other breakdowns of approaches. For example Requena (2003)

described three approaches, social networks, associational participation and generalized trust.

Another common analysis is based on the differences of the three early contemporary

authors; Bourdieu, Coleman and Putnam (Schuller et al. 2000). The four approaches

identified by Woolcock and Narayan (2000) provided a very sound analysis of the literature so

will be discussed in some detail below.

Communitarian Approach

Woolcock and Narayan (2000, p. 229) identified that ‘the communitarian perspective equates

social capital with such local organizations as clubs, associations, and civic groups’. The

communitarian approach was pioneered by Putnam (1993, 1995) and by Fukuyama (1995,

1997). Communitarians, who look at the number and density of these groups in a given

community, hold that social capital is inherently good, that more is better, and that its

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presence always has a positive effect on a community’s welfare’. This approach assumes

that communities are homogenous entities that automatically include and benefit all members

and as such do not make the important distinction between productive social capital and

perverse social capital. Narayan and Nyamwaya (1996) found evidence from the developing

world that demonstrates that high levels of social solidarity or informal groups does not

necessarily lead to economic prosperity (cited in Woolcock and Narayan 2000, p. 230).

Network Approach

Woolcock and Narayan (2000) identified that the network approach takes into account both

social capitals upside and its downside (see benefits and disadvantages section). This

approach ‘… stresses the importance of vertical as well as horizontal associations between

people and of relations within and among such organizational entities as community groups

and firms’ (Woolcock and Narayan 2000, p. 230). Sandefur and Laumann (1998, p. 484)

provided a useful description of the network approach ‘an individual’s potential stock of social

capital consists of the collection and pattern of relationships in which she is involved and to

which she has access, and further to the location and patterning of her associations in larger

social space’. Building on the work of Granovetter (1973) on network theories, authors such

as Burt (1992, 1997, 1998); Lin (1999, 2001); Portes (1995, 1997, 1998); and Portes and

Sensenbrenner (1993) have added to work taking this perspective. This approach focuses on

the importance of what has been termed bonding and bridging social capital in recent

literature. These terms are associated with the network theories of structural holes and

network closure (Adler and Kwon 2002). The closure argument is that a network of strongly

interconnected elements creates social capital. The structural hole argument is that social

capital is created by a network in which people can broker connections between otherwise

disconnected segments (Burt 2001). For Ronald Burt, the structural hole theory gives

concrete meaning to the social capital metaphor as he believes that social capital is more a

function of brokerage across structural holes than closure within a network (Burt 2000; Schmid

2003). The theory of network closure is important in understanding the impacts of social

capital on tight-knit communities. Burt (2000, p. 351) identified that ‘network closure facilitates

sanctions that make it less risky for people in the network to trust one another’. Further

discussion of these approaches is beyond the scope of this study however it is acknowledged

that the approach has made a considerable contribution to our understanding of social capital.

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Institutional Approach

Woolcock and Narayan (2000) identified that proponents of the institutional view argue that

the vitality of community networks and civil society is largely the product of the political, legal

and institutional environment. The approach views social capital as a dependent variable

where as the communitarian and networks perspectives largely treat social capital as an

independent variable giving rise to various outcomes (Woolcock and Narayan 2000). Authors

include Knack and Keefer (1995, 1997); Collier and Gunning (1999); Collier (1998, 2002);

Rodrik (1998, 1999) and Easterly (2000). Woolcock and Narayan (2000, p. 235) identified

that ‘the very strength of the institutional view in addressing macroeconomic policy concerns,

however, is also a weakness in that it lacks a microeconomic component’.

Synergy Approach

This view attempts to integrate the compelling work emerging from the networks and

institutional approaches (Woolcock and Narayan 2000). Authors include Fox (1992); Evans

(1992, 1995, 1996); Rose (1998); Woolcock (1998); Narayan (1999); and Fox and Brown

(1998). Woolcock and Narayan (2000, p. 236) identified that the three central key tasks for

synergy view theorists, researchers and policymakers is to ‘identify the nature and extent of a

community’s social relationships and formal institutions, and the interaction between them;

develop institutional strategies based on these social relations, particularly the extent of

bonding and bridging social capital; and to determine how the positive manifestations of social

capital – cooperation, trust and institutional efficiency – can offset sectarianism, isolationism

and corruption’.

2.7 Operationalization 2.7.1 Measurement of Social Capital There is considerable debate and controversy over the possibility, desirability and

practicability of measuring social capital, yet without a measure of the store of social capital,

its characteristics and potential remain unknown (Durlauf 2002b; Falk and Harrison 1998).

Measurement attempts are flawed by problems with separating form, source and

consequences (Adam and Roncevic 2003; Onyx and Bullen 2001; Sobels et al. 2001). An

example is trust, which is commonly seen as a component of social capital. Some authors

equate trust with social capital (Fukuyama 1995; Fukuyama 1997), some see trust as a

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source of social capital (Putnam et al. 1993), some see it as a form of social capital (Coleman

1988), and some see it as a collective asset resulting from social capital construed as a

relational asset (Lin 1999). Collier (2002) identified that social capital is difficult, if not

impossible to measure directly and that for empirical purposes the use of proxy indicators is

necessary. Social capital has constructs that are inherently abstract and require subjective

interpretation in their translation into operational measures, that are invariably indirect

surrogates of their associated constructs (Grootaert et al. 2002; Narayan and Cassidy 2001).

Callahan (1996) supported this, identifying that while it is hard to measure social capital

directly, it can be inferred from its powerful effects. The choice of indicators to measure social

capital is also guided by the scope of the concept and the breadth of the unit of observation

used (Collier 2002). Social capital is such a complex concept that it is not likely to be

represented by any single measure or figure. The multiple dimensions require sets of

indicators to be effective (Cox and Caldwell 2000). Considerations of measurement of social

capital inevitably reflect the conceptual debates about social capital itself, in particular,

whether social capital can be measured at an individual or community level (Baum and

Ziersch 2003).

Measuring social capital clearly has an intrinsic appeal (Inkeles 2000) however, as Fukuyama

(2001, p. 12) states, ‘one of the greatest weaknesses of the social capital concept is the

absence of consensus on how to measure it’. The measurement of social capital and the

assessment of its contribution are certainly in their infancy (Fox 1997). Daniere, Takahashi et

al (2002a) suggested that existing measures of social capital are subject to criticism because

researchers often define terms differently and because it is difficult to develop concrete,

tangible evidence of social capital that lends itself to quantitative analysis. Durlauf (2002)

supported this, positing that many definitions mix functional and causal conceptions of social

capital and that causal definitions of social capital are necessary for successful empirical

analysis. Paxton (1999) identified the widening gap between the concept of social capital and

its measurement. The popularity of the term seems to have encouraged the use of overly-

aggregated, heterogeneous indexes (Knack 2002). Due to the abstract nature of social

capital and varying definitions, it is often measured inconsistently between studies (Liu and

Besser 2003). Previous studies provide little rationale for how their measures of social capital

connect to the theoretical definition of social capital (Paxton 1999). Stone (2001) posited that

there are insufficient tools for empirical measurement available and this is an area where

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further research is required despite the extensive work of the Australian Bureau of Statistics

(2002), Bullen and Onyx (1998), Lochner, Kawachi et al (1999), Onyx and Bullen (2000) and

Stone and Hughes (2002). Cavaye (2004, p. 13) identified the following issues in the

measurement of social capital that remain unresolved:

A clear understanding of the context and purpose of the measurement of social capital

Understanding the limitations of evaluation and measurement, and ensuring that the

interpretation of measures is held within these limitations

The practical mechanics of gaining community feedback such as community

representation and coverage, feedback to communities, use in local decision making,

and resourcing measurement

Benchmarking vs. measures of incremental change

Dealing with qualitative information, diversity, variation and complexity

The nature and rigor of indicators

The interpretation and use of measurement information

How evaluation itself can contribute to fostering social capital.

Fukuyama (2001) posited that producing anything like a believable census of a society’s stock

of social capital is a nearly impossible task, since it involves multiplying numbers that are

either subjectively estimated or simply non-existent. Measurement of social capital becomes

self fulfilling as one tends to find what one is looking for but does not tend to question the path

(Inkeles 2000; White 2002). In fact, the concepts usefulness appears to be limited in that it is

difficult to operationalise using proxy measures that are distinct from the predicted effects

(Falk and Harrison 1998; Krishna 1999; Sobels et al. 2001; Woolcock 1998). This is further

supported by Stone (2001, p. viii) who stated that ‘where social capital has been measured to

date, it has often been done so using ‘questionable measures’, often designed for other

purposes, and without sufficient regard to the theoretical underpinnings of the concept to

ensure validity or reliability’. The act of measuring social capital can and probably will affect

the stock of capital that is being assessed, which adds further questions to the suitability of

attempts to empirically measure social capital (MacGillivray and Walker 2000; Popay 2000).

Grootaert and Van Bastalaer (2002a) on the other hand posited that it is possible to measure

social capital and its impact. Onyx and Bullen (2000b) claimed they have developed a reliable

and valid measure of social capital – one that is relatively easy to apply. Ideal indicators

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recognize that social capital can be expressed through attitudes and expectations; through

reported, recorded and observed actions and activities; and by comparing people’s

interpretations of how things happened or are expected to happen (Cox and Caldwell 2000).

Ideally, measures of social capital should be thoroughly based on, and tied to, the conceptual

framework for the specific study. Cavaye (2004) described the development of consistent

frameworks and that there are no best indicators, rather some key characteristics that guide

the choice of indicators such as:

specificity – targeted to the variable to be measured,

measurability - ease of measurement,

comprehensiveness - measures of a range of social characteristics,

reliability and rigor,

continuity – ability to translate across situations and be consistent in local state or

national frameworks.

The challenge is to develop consistent indicators that can allow conclusions to be drawn

across local, state and national frameworks (Cavaye 2004).

A report by the Productivity Commission (2003, p. 25) made the following observation about

the measurement of social capital:

‘Like the theoretical literature, the empirical literature is evolving. Because social capital

as a concept is relatively new, multifaceted and imprecise, ‘hard data’ on it are not readily

available. Inevitably, many early studies have had to rely on rough proxies for social

capital and/or have been somewhat experimental. Hence, the results need to be

interpreted with care; in most cases they are ‘suggestive’, rather than definitive.’

Some authors have applied various indicators of social capital in different contexts. Examples

include:

trust (Cox and Caldwell 2000; Falk and Guenther 1999; Glaeser et al. 2000; Guenther

and Falk 1999; Kolankiewicz 1996);

membership (Baum and Ziersch 2003; O'Connell 2003; Price 2002; Warde et al. 2003;

Wollebaek and Selle 2003);

membership and trust (Lappe et al. 1997; Lochner et al. 2003; Veenstra 2002);

membership, trust and norms of reciprocity (Isham et al. 2002; Skrabski et al. 2003;

Staveren 2003); and

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network resources (Zhao 2002).

Grootaert (2001) identified the indicators detailed in table 4 as having all been used in

empirical studies.

Table 4. Indicators of social capital (Source: Grootaert 2001)

Horizontal associations

Number and type of associations or local

institutions

Extent of membership in local associations

Extent of participatory decision making

Extent of kin homogeneity within the association

Extent of income and occupation homogeneity

within the association

Extent of trust in village members and

households

Extent of trust in government

Extent of trust in trade unions

Perception of extent of community organization

Reliance on networks of support

Percentage of household income from remittances

Percentage of household expenditure for gifts and

transfers

Civil and political society

Index of civil liberties

Percentage of population facing political

discrimination

Index of intensity of political discrimination

Percentage of population facing economic

discrimination

Index of intensity of economic discrimination

Percentage of population involved in separatist

movement

Gastil’s index of political rights

Freedom House index of political freedoms

Index of democracy

Index of corruption

Index of government inefficiency

Strength of democratic institutions

Measure of ‘human liberty’

Measure of political stability

Degree of decentralization of government

Voter turnout

Political assassinations

Constitutional government changes

Coups

Social integration

Indicator of social mobility

Measure of strength of ‘social tensions’

Ethnolinguistic fragmentation

Other crime rates

Prisoners per 100,000 people

Illegitimacy rates

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Riots and protest demonstrations

Strikes

Homicide rates

Suicide rates

Percentage of single-parent homes

Divorce rate

Youth unemployment rate

Legal and governance aspects

Quality of bureaucracy

Independence of court system

Expropriation and nationalization risk

Repudiation of contracts by government

Contract enforceability

Contract-intensive money

The relative success and appropriateness of these studies depend on the local context under

which the indicators were applied but ultimately, as discussed earlier, such measures do not

take into account the multi-dimensional nature of social capital and the inherent source, form,

consequence problems. Other more multi-dimensional measures have been undertaken,

however the problems discussed above have not been overcome. Studies including:

Narayan and Princhett (1997) constructed a measure of social capital from a survey of

87 villages in rural Tanzania, which examined social capital and ‘village-level

outcomes’;

Onyx and Bullen (1997) sought to measure social capital in five localities in New South

Wales using a 68-question survey;

Barr (1999) used experimental game theory techniques to measure trust and familiarity

in selected black communities in Zimbabwe; and

Putnam (2000) see figure 10.

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Putnam’s indicators of social capital for the United States

Measures of community or organizational life:

Percentage of individuals who served on a committee of a local organization in the last year

(0.88a)

Percentage of individuals who served as an officer of some club or organization in the last year

(0.83)

Civic and social organizations per 1000 population (0.78)

Mean number of club meetings attended in the last year (0.78)

Mean number of group memberships (0.74)

Measures of engagement in public affairs:

Turnout in presidential elections, 1988 and 1992 (0.84)

Percentage of individuals who attended public meeting on town or school affairs in last year (0.77)

Measures of community volunteerism:

Number of non-profit organizations per 1000 population (0.82)

Mean number of times worked on a community project in last year (0.65)

Mean number of times did volunteer work last year (0.66)

Measures of informal sociability:

Percentage of individuals who agree that ‘I spend a lot of time visiting friends’ (0.73)

Mean number of times entertained at home last year (0.67)

Measures of social trust:

Percentage of individuals who agree that ‘most people can be trusted’ (0.92)

Percentage of individuals who agree that ‘most people are honest’ (0.84)

a The figure in brackets indicates the item’s coefficient of correlation with the final constructed measure across

the individual states of the United States.

Figure 10. Putnam’s indicators of social capital for the United States

Source: Putnam (2000) cited in Productivity Commission (2003).

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2.7.2 Building Social Capital A fundamental question is whether social capital can be increased in the short term. This

question is further complicated by the debate over whether social capital can be measured, as

without measurement, change cannot be determined. According to Putnam (1993), social

capital is largely determined by historical factors; it can thus not be enhanced in the short

term. This view has been challenged in the literature. Petersen (2002) posited that social

capital creation is possible be definition. This is supported by Schmid (2000) and Uslaner and

Dekker (2001) who saw social capital development as a by-product of other activities. Falk

and Harrison (1998) suggested that it is possible to build social capital in the short term and

that this is also known as capacity building. Social capital can be produced by the

government, nongovernmental organizations, local societal actors and external actors in the

civil society, both in combination and in isolation (Cernea 1993; Huntoon 2001; Mondal 2000).

Insufficient attention has been paid to the variety of locations where social capital can be

generated, inhibited, and appropriated, and the role played by other actors, such as public

institutions in this process (Heller 1996; Maloney et al. 2000; Preece 2002). To better explain

the production of social capital, analytical frameworks need to account for widely varying

outcomes in terms of time, space and social groups (Fox 1996; Lorensen 2002; Minkoff 1997).

Soubeyran and Weber (2002) posited that social capital can be created through repeated

exchange and face-to-face contacts, which is facilitated by geographic proximity. Maloney,

Smith et al (2000) suggested that there is a lack of research into generation, maintenance,

and destruction of social capital.

Onyx and Bullen (2000a) believed that the development of social capital requires the active

and willing engagement of citizens within a participative community. Social capital building

exercises initiated by the state have been identified as weak due to distant ties, therefore

social capital building must occur through outsourcing by government (Onyx and Bullen 2001;

Taylor 2000; Warner 1999). This supports Lowndes and Wilson’s (2001) theory that the best

way for government to increase social capital is to be involved in indirect social capital

building. Warner (2001) posited that local government is better placed to create local social

capital through community based interventions. Cox and Caldwell (2000) identified that the

key social dynamics for building social capital occur in the non-intimate and non-exclusive

groups. Falk and Harrison (1998) had a different view, suggesting that social capital building

can be equated with capacity building in terms of community development. The use of social

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capital in any of its forms does not deplete the supply of social capital (Lyons 2000; Turner

1999). Some authors suggest that use of social capital in fact enhances the supply of social

capital. From this debate it is clear that some authors conceptualize social capital as either a

flow or stock resource (Walker and Kogut 1997; Wilson 1997; Woolcock 2002a). There is

limited understanding of the processes and how they operate to build or improve social capital

structure.

2.8 Gender Issues in Social Capital Theory One area social capital literature is weak on is gender (Kilby 2002). Ethnic and gender

dimensions of social capital remain under-recognized (Fox and Gershman 2000; Molinas

1998). In the literature, social capital is generally conceptualized gender-blind, paying little

attention to gendered intra-household issues of power and hierarchy (Norton 2001; Silvey and

Elmhirst 2003). Silvey and Elmhirst (2003) argued that for a more complete picture of social

capital, specifically one that includes attention to the gendered and intergenerational conflicts

and hierarchies within social networks, and the broader context of gender difference within

which social networks are forged. The authors also posited that social capital that exists

within a broader context of gender inequality can exacerbate women’s disadvantages, as

women remain excluded from the more powerful networks of trust and reciprocity that exist

among men (Silvey and Elmhirst 2003).

2.9 Social Capital and Natural Resource Management There is some, but limited literature linking social capital theory and natural resource

management. Enhanced social capital can improve environmental outcomes through

decreased costs of collective action, increase in knowledge and information flows, increased

cooperation, less resource degradation and depletion, more investment in common lands and

water systems, improved monitoring and enforcement (Anderson et al. 2002; Daniere et al.

2002a; Daniere et al. 2002b; Koka and Prescott 2002). There is a growing interest in social

capital and its potential impact for affecting collective action in sustainable renewable natural

resource institutions (Rudd 2000; Sobels et al. 2001; Walters 2002). Pretty and Ward (2001)

identified that where social capital is well-developed, local groups with locally developed rules

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and sanctions are able to make more of existing resources than individuals working alone or

in competition. Social capital indicates a community’s potential for cooperative action to

address local problems (Fukuyama 2001; Pilkington 2002; Ritchie 2000). As it lowers the

costs of working together, social capital facilitates cooperation and voluntary compliance with

rules (Isham and Kahkonen 2002; Pretty and Ward 2001). The norm of generalized

reciprocity assists in the solution of problems of collective action. Adler and Kwon (2002)

identified that it transforms individuals from self-seeking and egocentric agents with little

sense of obligation to others into members of a community with shared interests, a common

identity, and a commitment to the common good. Brewer (2003) believed that denser

networks increase the likelihood that people will engage in collective action. There is also

evidence linking social capital to greater innovation and flexibility in policy making (Knack

2002).

In the field of development it offers the potential for more participatory, sustainable and

empowering approaches in theory and practice (Chhibber 1999; Evans 1996; Woolcock and

Narayan 2000). Krishna and Uphoff (2002) found that an index of social capital variables is

positively and consistently correlated with superior development outcomes. Social and human

capital, embedded in participatory groups within rural communities has been central to

equitable and sustainable solutions to local development problems (Pretty and Frank 2000;

Pretty and Ward 2001). Grootaert and Van Bastelaer (2002a, p. 344) stated that ‘social

capital has a profound impact in many different areas of human life and development: it

affects the provision of services, in both urban and rural areas; transforms the prospects for

agricultural development; influences the expansion of private enterprises; improves the

management of common resources; helps improve education; can contribute to recovery from

conflict; and can help compensate for a deficient state’. Social capital is critical for poverty

alleviation and sustainable human and economic development (Dolfsma and Dannreuther

2003; Grootaert and Van Bastelaer 2002c). It represents a potential link between policy level

thinking and community level action (Pretty and Ward 2001). The mobilization of social capital

requires a high degree of sensitivity to the specific nature of the societies involved in order to

have positive effects (McHugh and Prasetyo 2002). Social capital reduces the costs

associated with working together thereby facilitating collective action (Ostrom 1994; Ostrom

1999). There is a need for further research in this area.

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2.10 Social Capital Literature Review Summary The evolution of social capital section revealed that there appears to be consensus on the

intellectual history of the concept and although there was controversy over the first use of the

term, there now appears to be agreement on this point. Different authors see the role and

value of the contemporary authors work on social capital differently. There is presently no

commonly agreed definition of social capital however many authors stress the importance of

basing the operationalization and conceptualization of the concept on a thorough definition.

Perhaps more important than the definitional problems is the controversy over the use of the

term ‘capital’. There is compelling evidence to suggest that we should move beyond ‘capital’

debate and accept that the term is unlikely to be replaced for various reasons.

Social capital is a complex theory with many dimensions, types, levels and determinants and

although different authors identify different dimensions of social capital all authors seem to

agree that social capital is multi-dimensional. Further research is needed to conceptualize the

various dimensions within a workable framework. Although widely debated, it is now accepted

that social capital exists at the micro, meso and macro levels. Again it is identified that further

work is required to conceptualize the various levels, and ownership of social capital as well as

the types, to establish an agreed framework and definition. Much work is still required to

move the understanding of social capital determinants from the applied theory area to have

empirical support.

There are numerous purported benefits of social capital that largely arise from theoretical

extrapolation. It is surprising that there is little skepticism of the benefits considering the lack

of rigorous empirical evidence. The importance of the concept is demonstrated by the

unprecedented interest and application of the concept. Although well recognized in the

literature, many authors do not take the negative aspects of social capital into account,

particularly in empirical studies. The causal relationships that determine productive / perverse

social capital appear to be highly context specific and therefore require further research.

There is agreement in the literature that the concept lacks a rigorous conceptualization and

that this is required for valid empirical research. There is disagreement over the role of

economics in this process. Much work has been done in recent years to further conceptualize

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the concept and it appears to be now possible to synthesize an appropriate conceptualization

from the existing literature for a specific study.

Although there has been a number of different approaches taken for research in the area of

social capital research, there is much fruit to be taken from a synthesis of the various

approaches. There is considerable debate and controversy over the possibility, desirability

and practicality of measuring social capital yet without a measure of the store of social capital,

its characteristics and potential remain unknown. Many authors have identified that

measurement attempts are flawed by problems with separating form, source and

consequences, however, a large number of studies have applied questionable techniques to a

very wide range of applications. Clearly there is disagreement over the validity of measures of

social capital. There are many unresolved issues involved in the measurement of social

capital. It seems from the literature that designing and applying context appropriate indicators

of social capital can achieve useful measurement, however further work is needed to develop

this area of the theory.

It is now widely accepted that social capital can be increased in the short term however there

is a lack of understanding of the processes and how they operate to build or improve social

capital structure. Although there has been very little work directly on social capital and natural

resource management there are studies that can be applied to the area. Much work is

required to understand the interaction of social capital and natural resource management

outcomes.

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3.0 Methodology Social capital is an attractive but complex concept that is in its early stages of theoretical

development. For this reason, this study utilized an adaptive research method. The research

objectives originally chosen for this study evolved during the development of the research.

Chapter 1 traces the change of the objectives from measurement of social capital in natural

resource management, to application of social capital theory to natural resource management

and finally to a more thorough conceptualization of social capital. As previously identified,

primary data analysis was ruled out as an option for this study as conclusions from the social

capital literature review revealed that social capital is inherently abstract in nature and does

not lend itself to meaningful or rigorous quantitative or qualitative measurement. Secondary

data analysis was therefore used and a rigorous method of literature identification and review

was undertaken. Databases were selected from a range of disciplines including sociology,

economics, political science and anthropology. A selection of the databases searched is

included in table 5 which indicates the number of references identified as containing social

capital in the title. Scholarly journals, books, reports and conference proceedings were

searched. The extensive results of this search were browsed for relevant documents, and

those documents acquired. These references were then reviewed and the search expanded

by reviewing both cited papers and papers that cited the original (where available). Particular

attention was paid to relevant work cited by authors of reviewed papers. In this way patterns

of citation became evident, with sociologists typically citing Coleman and political scientists

typically citing Putnam. Through this process, new references were encountered more

infrequently as the reviewed collection increased. The total number of references reviewed

reached approximately 500 and represents a thorough synthesis of current social capital

literature.

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Table 5. List of databases searched for social capital and results

Database Results British Humanities Index 104

Business Source Premier 369 Communication Abstracts 20 Communication Studies: A SAGE Full-Text Collection 82 Criminology: A SAGE Full-Text Collection 107 Econlit 381 ERIC 468 Informit online 749 ISI Web of Knowledge 158 JSTOR 48 Linguistics and Language Behavior Abstracts 8 National Criminal Justice Reference Service Abstracts 88 Oxford Journals 42 Physical Education Index 8 Politics and International Relations: A SAGE Full-Text Collection 223 Proquest 605 PsycARTICLES 82 Social Services Abstracts 83 Sociological Abstracts 1484 Sociology: A SAGE Full-Text Collection 457 Worldwide Political Science Abstracts 439

The extensive literature review provided a sound platform for advancement of the conceptual

understanding of social capital. This involved mapping the existing knowledge and past

conceptualization attempts to identify inconsistencies and gaps. A number of new factors

were then identified and conceptualized within the existing framework of knowledge. A

number of important findings were also identified that provide a basis for further theoretical

research.

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4.0 Results 4.1 Preliminary measurement framework for application to

natural resource management The many problems associated with the operationalization of social capital theory have been

discussed in previous sections. This section will briefly discuss the requirements for a

rigorous measurement framework based on the conceptualization (chapter 4.2), and aim to

propose a preliminary measurement framework for application to natural resource

management.

As identified in the literature review, and illustrated in the conceptualization (chapter 4.2), the

operationalization of social capital is made difficult by the problem of separating the source,

form and consequences. The nature of social capital means that it is necessary to use a

proxy or indicator of social capital, as it cannot be directly measured. Past empirical studies

have used indicators that relate to the outcomes of social capital. A useful distinction is the

classification into proximal and distal groupings. Proximal indicators of social capital are in

fact outcomes of social capital related to its core components (networks, trust and reciprocity).

Distal indicators are outcomes that are not directly related to its key components and thus

may not be valid measures of social capital itself. There is little empirical evidence to support

the relationship between indicators and the core components of social capital. This highlights

the tautological problem that research reliant upon an outcome of social capital as an indicator

of it, will necessarily find social capital to be related to that outcome, without empirical means

to explain why, or indeed whether, this is so (see Stone 2001 for further discussion). Social

capital can be seen as the structure and quality of social networks. As such, the core

dimensions of social capital are seen to be networks of social relations (structure), which are

characterized by norms of trust and reciprocity (quality) (refer to table 6).

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Table 6. Core dimensions of social capital and their characteristics

Structure of social relations: networks Quality of social relations: norms

Type:

Informal – formal

Size / capacity:

Limited – extensive

Spatial:

Household – global

Structural:

Open – closed

Dense – sparse

Homogenous – heterogeneous

Relational:

Vertical – horizontal

Norms of trust

Social trust

- Familiar / personal

- Generalized

Civic / institutional trust

Norms of reciprocity

In-kind v in lieu

Direct v indirect

Immediate v delayed

Source: Stone (2001, p. 7)

Stone (2001, p. 6) stated that ‘by linking social capital measurement directly to theoretical

understandings of the concept, we are able to: first, recognize that social capital is a

multidimensional concept comprising social networks, norms of trust, and norms of reciprocity;

second, understand social capital properly as a resource to action; and third, empirically

distinguish between social capital and its outcomes’. This provides a sound basis for

developing a measurement framework but much work is required to ensure the indicators

relate to this theoretical understanding. If we break down one of the core dimensions, social

networks, the complexity becomes immediately evident. In table 7, networks are broken into

informal and formal and the types evident at the macro level listed. For each of the types

listed in the table a series of questions could be developed. However the problem of how they

relate to the theoretical understanding remains unresolved. Other problems also become

evident. This macro level analysis of social capital is of little use to the majority of studies that

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investigate social capital at the meso level. This illustrates the context specific nature of

suitable social capital measures. Other issues remain unresolved such as spatial and

temporal issues, externalities, feedback loops, and the role of chance in shaping both the

structure and the outcomes. It is implausible to add bridging capital to bonding capital and

subtract perverse social capital. Thus an amount of social capital should not be sort, not even

qualitatively. Instead, social capital should be analysed in terms of a composite of its

disparate, yet interrelated, components. Therefore, social capital building initiatives should

aim to improve the structure of social capital rather than increase social capital per se.

Table 7. Types of Informal and Formal Networks

Informal networks Formal networks of social relations

Family household Family beyond the household Friends / intimates Neighbors

Non-group based civic relations - Good deeds - Individual community or political action

Associations / groups based on relationships

- Antenatal - Childcare - Education - Sport / leisure - Music / art - Church - Charity - Voluntary - Self help

Work based

- Colleagues - Associations

Institutional

- State

Source: Stone (2001, p. 7)

Natural resource management applications of social capital can involve micro to macro level

analysis. The primary level of interest is the meso level as studies focus on the application of

social capital theory to an area of common interest: natural resource management. The focus

can be on micro – individuals; meso - groups of individuals, groups of like groups, groups of

natural resource management groups, or national natural resource management groups; or

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macro – societal (refer to figure 11). This situation is further complicated when taking into

account various institutions associated with natural resource management, including

voluntary, non-government, government and private sector. The structural elements of social

capital will be different depending on the level of study, as will be the relationships between

determinants, structure, manifestations and levels, even those levels not under investigation.

Figure 11. Levels at which social capital operates within natural resource management.

An important finding for this study is that social capital application to natural resource

management must involve a rigorous conceptualization that accounts for the interrelationships

and complexity of the concept. The above discussion highlights the importance of designing

the operationalization of social capital specifically to the application context. It is concluded

that there is presently no suitable measure of social capital and thus no suitable measure for

application to natural resource management. The adoption of an existing measure for use in

natural resource management would contribute to the existing problem of measurement not

being linked to the theoretical understanding of social capital. It is beyond the scope of this

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thesis to design both a conceptualization and an appropriate methodology for measurement of

social capital in natural resource management settings.

4.2 Conceptualization of Social Capital Any conceptualization of social capital aims to simplify the complexity of the social world to

assist in the development of an understanding of the structures and processes that affect a

variety of outcomes. The challenge is to make tradeoffs between competing objectives –

simplification to facilitate increased understanding, and maintenance of the complexity to

maximize validity. In the past, many efforts to conceptualize social capital have resulted in

over-simplification and therefore questionable operationalization. There are considerable

unknowns surrounding our current understanding of social capital theory. We know that

various relationships exist between determinants,

structural elements and consequences or

manifestations but interactions are largely unknown

(refer to figure 12). Anything that has an impact on

social interactions can be seen as a determinant and

any situation arising because of social interactions

can be seen as a manifestation. We know some of

the elements in between but have little

understanding of the processes. This highlights the

importance of establishing a rigorous

conceptualization, as the appropriate

operationalization of social capital must be based on

a rigorous conceptualization.

Figure 12. Current attempts to conceptualize social capital do not sufficiently account for the complexity between the determinants and consequences or outcomes of social capital.

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The conceptualization designed for the purposes of this study details processes and

relationships operating between the determinants of social capital, the structure, or elements

of social capital, and the consequences or manifestations of social capital (refer to figure 13).

It attempts to take into account factors such as causal relationships, specific contexts,

externalities, levels, feedback loops and chance (refer to figure 14). This section will discuss

this conceptualization and highlight the need for further research to reach a more rigorous

conceptualization of social capital in general and particularly for application to natural resource

management outcomes.

The literature review identified a wide range of determinants that have been linked to social

capital including history and culture, social structures, family, education, environment, mobility,

economics, social class, civil society, consumption, values, networks, associations, political

society, institutions, policy, and social norms at various levels. Clearly the factors listed here

play an important role in determining the characteristics of the social capital structure however

the causal factors and functional relationships are largely unknown. Some studies have

focused on some of the factors in-so-much as detailing the social capital of the circumstance,

for example, family, trust, or networks, but have not studied factors as determinants of multi

level, multi dimensional social capital.

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Figure 13. The links between determinants, structural elements and consequences or manifestations are currently not well understood and generally grossly oversimplified.

It is important to identify that social capital building, and measuring attempts, focus on

different components of the conceptualization detailed in figure 14. While social capital

building projects could focus on particular aspects of the structure, they are unlikely to be

effective without attention to, or understanding of, the underlying determinants that bring about

the given structure (refer to discussion of feedback loops). An appropriate analogy is to treat

the symptom rather than the cause of the problem. Investment could be negated by

underlying feedback loops or context specific determinants. Similarly, attempts to measure

only the consequences of social capital are only capturing a snapshot of a moving target.

Social capital is a dynamic relationship between its components that evolves constantly on

spatial and temporal scales. Every social interaction between actors has wide ranging and

unpredictable outcomes to the structure and consequences of the social capital at various

levels. Similar structures can have very different externalities and ends (displayed as a

continuum in figure 13, negative examples include exclusion and crime), and the role of time,

space, feedback loops and chance further illustrate the complexity of the dynamic

relationships involved. It is particularly important to identify the causal factors and the specific

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context as these are most critical in determining the structural elements and consequences or

manifestations. These factors are not considered in the literature.

Figure 14. Conceptualization of social capital simplifying the complexity of the social world into a diagram outlining relationships between determinants, structure (or elements) and consequences.

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Various aspects of social capital structure are identified in figure 14. These could be referred

to as elements, components, forms or factors. Although difficult to identify on paper, this

conceptualization should be thought of as three dimensional – with the various levels acting

as the third dimension (for an example of the application to natural resource management see

figure 11 page 61). Ties are a fundamental component of social capital that describes the

nature of social relationships, which simply put, can be strong or weak. Hierarchical refers to

the distribution of vertical and horizontal ties. Temporal features are identified as a

component as time has a considerable impact on other components of social capital. There is

significant change in the nature of social capital over time, particularly with depreciation,

reinforcing of ties and other network features. Figure 15 hypothesizes the possible temporal

change of different norms over time. Both the norms relate to trust and reciprocity. Norms of

networks, associated with ties, are expected to decrease over time with decreased expected

future returns (connected to rational choice theory). These norms should be separate from

norms associated with membership or belonging which may or may not include a social tie.

These norms are likely to increase over time as one develops reminiscence and therefore

increased strength of norms of trust and reciprocity towards other members whether a

network tie existed or not. This diagram is a generalization based on applied theory and does

not attempt to illustrate the complexity of social processes as there are likely to be numerous

factors affecting the strength of norms over time.

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Figure 15. Norms of networks are likely to depreciate over time without reinforcement while norms of membership and belonging are likely to increase over time.

Membership accessibility (refer to figure 14) relates to whether there is group exclusion or

inclusion and so strongly determines the nature of the externalities. The type refers to

important distinctions made in the literature between structural and cognitive, and between

bonding and bridging social capital. There are many aspects of network structure (the study

of network theories) that are relevant to social capital structure. The concepts of network

closure and structural holes play a significant role in the interaction of ties at the meso and

macro levels. As such, spatial features interact to determine the nature and impacts of social

capital structure. It has been found in past studies that geographic proximity has a role in the

formation of norms of reciprocity and the strength of ties, particularly in relation to the sense of

belonging and membership through the opportunity for face to face contact and reinforcement

of norms, particularly information flows. Technology has rapidly changed the effect of space

and time on social capital networks. Email is increasingly being utilized for communication,

which offers cheap and fast connectivity that compresses the space-time continuum. More

recently SMS (short message service) is increasing networks of mobility. Both of these

technologies have different impacts on social capital because of the lack of personal contact

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of face-to-face interaction. The type of social capital that is produced from this interaction is

significantly different from that found in traditional relations (for further discussion see

(Kavanaugh and Patterson 2001; Meredyth and Ewing 2003; Pruijt 2002; Sullivan et al. 2002;

Wellman et al. 2001)). Although there are benefits, this contributes to social isolation,

particularly in urban centers of developed countries. Whereas in the past, social networks

were commonly based on proximity, they are now based more on work and interest groups.

The strength of networks based on proximity has decreased because people know few of their

neighbors, particularly in medium to high density areas and where there is high residential

mobility. The result is limited opportunity for repeated interaction, which is fundamental to the

equilibrium concept for social capital generation.

Alignment has received little attention in the literature but is significant for similar reasons to

spatial features. Alignment refers to the interests, beliefs and views of individuals or groups.

People may be aligned to groups or communities for various reasons, and this ‘membership’

results in a range of social capital manifestations. There is a dynamic relationship between all

of the components described above with the other factors identified in figure 14 under the

social capital structure bubble. These factors include, specific context, level, externalities,

chance and feedback loops.

Just as the determinants are context specific, the consequences that result from the social

capital structure strongly relate to circumstances that change rapidly over time. For example,

only under certain circumstances can social capital be realized; one cannot cash in a favor

anytime. Also, the social capital structure operating behind vastly different manifestations,

such as collective action and organized crime, are not necessarily different – only the

circumstances. The level at which social capital is located has pervaded much of this

discussion of social capital conceptualization. This is because different components of social

capital operate at different levels. Ties operate at the individual level by their very nature

(refer to figure 16), but aggregates of ties, described by network theory, operate at the meso

and macro levels. Meso level studies look at groups, but these groups are still made up of

individuals, with ties to other individuals outside the group and to other groups through ties

with individuals who are members of other groups and through multiple membership. The

complexity of these meso level interactions cannot be effectively graphically represented.

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Another example is belonging (types) that exists within levels or scales as one feels belonging

to family, community, profession, country simultaneously.

Due to the transitory, impermanent nature of social capital, chance plays an important role.

Chance meetings and chance events both play an important role in the structure of social

capital but also in realizing the manifestations of social capital. For example, an individual

might meet, by chance, a work colleague away from the workplace. This is likely to transform

the weak tie from being associated with the same employer to a strong tie associated with

belonging, mutual interest, and so on, and strong norms of reciprocity, thereby transforming

the organizational social capital – representing changes at both the micro and meso levels.

Another chance event may prevent this potential from being realized, for example, if the

colleague is away in a time of need.

There is evidence to suggest that there are a series of feedback loops that operate within the

dynamic relationships between the components of social capital. For example, a community

network created to build social capital has initial benefits in terms of information flows, norms

of reciprocity and trust, however, network closure results in norms that restrict behavior with a

high likelihood of negative externalities thereby self-regulating total benefit and potentially

returning community networks to pre-project states through loss of membership. The role of

determinants should be highlighted as there may be an underlying reason for propensity for

network closure and negative ends – such as history, geographic scale, religion, family and

other social norms. This highlights the fact that an event can be a determinant of social

capital; a breach of trust for example. In this way, the dynamic relationships of social capital

structural elements become somewhat self regulatory, fundamentally based on the context

specific determinants. This is what could have led Putnam to state that social capital’s roots

were buried in centuries of cultural evolution and therefore cannot be built in the short term.

The existence of feedback loops is further supported by other authors (for example, Biox and

Prosner 1998) who have posited social capital theories as an equilibrium concept, although as

equilibrium in terms of expected returns. It would be more appropriate to think of social capital

as an equilibrium caused by limits and determinants, particularly in terms of beneficial

manifestations.

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Figure 16 identifies the location of social capital at the micro level. It is important to identify

that different outcomes of social capital are evident at different levels. At the micro level the

main outcomes relate to norms of reciprocity and information flows. In the diagram (figure 16)

it can be seen that neither individual ‘owns’ the social capital that exists between them. At the

meso level, it can be understood that an individual has a level of ownership or control of his or

her social capital by choosing ties and membership and therefore sharing his or her social

capital. Some authors refer to structure and quality of relationships as these factors are

thought to be important in achieving various outcomes. Norms operate at various levels.

Norms of reciprocity exist between the individuals, as do social norms that govern behavior.

These same norms operate at other levels simultaneously, both meso and macro.

Figure 16. Location of social capital at the individual level within the framework of micro level social capital interactions.

From this discussion it can be seen that social capital involves complex interactions between

its determinants, structure and manifestations. The structure of social capital is marked by

dynamic relationships between its components with the roles of chance, feedback loops and

externalities that determine the outcomes or manifestations largely unknown. These

relationships are further complicated by the level of investigation. Components operate at

different levels and there is considerable interaction between components operating at

different levels simultaneously. This complexity highlights the inadequacy of the current

conceptualization of social capital, particularly for application to measurement and building

attempts. As identified throughout this study, there is further need for research to determine

the various causal factors and their relationships to determinants, structure and

manifestations. Application should be primarily descriptive and process oriented in the area of

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applied theory as further work is required to enable appropriate conceptualization upon which

to base appropriate operationalization.

5.0 Conclusions To date, attempts to conceptualize social capital have not taken into account the complexity of

interactions between determinants, structural elements and consequences or manifestations.

The result is a tenuous link between the operationalization and theoretical understanding of

the concept. This study aimed to lessen this problem by developing a more rigorous

conceptualization of social capital. This aim was met by achieving the three objectives: (1)

synthesis of current literature, (2) identification of appropriate measurement framework, and

(3) the development of a more appropriate conceptualization. The first objective was

achieved through an extensive review of existing literature on social capital, particularly

looking at theory, conceptualization and operationalization (chapter 2). The major finding from

the literature review was that there are serious deficiencies in the current understanding of

social capital that result in questionable operationalization.

The second objective was achieved through an analysis of current theory in terms of

measurement. Various aspects of the theory were identified and discussed (chapter 4.1).

The major finding was that there is currently no appropriate measurement framework, and

therefore no framework for application to natural resource management, because such a

framework would need to be based on an appropriate conceptualization of social capital.

The third objective required extensive analysis of current theory on social capital, made

possible by the broad literature review. Chapter 4.2 highlighted the complexity of social

capital, particularly in terms of level and structure. This complexity was conceptualized in

terms of the relationships between determinants, structural elements and manifestations and

included externalities, chance, level, feedback loops and specific context. The dynamic

relationship between the structural elements included various aspects of the current theory,

with deficiencies accounted for. One of the important findings involved the relationships of

space and time. Another vital element of the conceptualization that has so far been

overlooked is the concept of an event as a determinant. This has significant consequences

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for a range of circumstances in relation to building efforts and in minimizing loss. This study

also highlighted the importance of building and measurement activities focusing on different

components of the conceptualization. The most important finding is that social capital is

highly context specific and it can be theorized that the structure and consequences of social

capital are not highly correlated due to importance of specific context. These findings

contribute considerably to the current theoretical understanding of social capital, thus

achieving the third objective.

This study provides the basis for further conceptualization and identifies a number of areas

where further research is required. There are currently a plethora of categorizations of social

capital in the literature that require further work to establish a rigorous set of types. Another

area that requires work is the causal relationships that determine productive / perverse social

capital that appear to be highly context specific. A particularly important area is in the

development of sufficient tools for empirical measurement and theoretically informed building

attempts. There are a number of other research areas identified, including:

• processes working to reduce the costs associated with working together thereby

facilitating collective action;

• the various levels, and ownership of social capital as well as the types, to establish

an agreed framework and definition (with empirical support);

• processes and how they operate to build or improve social capital structure; and

• each of the elements of the conceptualization and measurement based on this

theoretical framework.

Extra References

Page 73

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