Social capital

Social capital refers to the capital captured though social relationships and the networks they produce. Relationships have value whether they are economic, political, labor or community based social networks. Individuals and social networks engage in relationships that are able interact in order to produce profit. The profit involved with social capital may range from the value placed upon a personal reference for entry to employment or school to members of a community working on a common project.

There are a variety of inter-related definitions of social capital, but a general definition defines Social Capital as an “investment in social relations with expected returns in the marketplace” . This definition is consistent with the various renditions by scholars like Bourdieu, Lin, Coleman, Flap, Burt, Putnam, Erickson, Portes and others who have contributed to the social capital discussion.

The term Social Capital was introduced by Hanifan in 1920 when he defined social capital as “those tangible assets… namely good will, fellowship, sympathy and social intercourse among the individual and families who make up a social unit” . The sociologist James Colman credits the term to economist Glenn Loury with the concept explained social capital as a set of designated intangible resources in families and communities that help to promote the social development of young people. The sociologist Pierrer Bourdieu defined the concept 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 or recognition” ]. He pointed out that “Social capital is the sum of the resources, actual and virtual, that accrue to an individual or a group by virtue of possessing a durable network of more or less institutionalized relationships of mutual acquaintances and recognition” . James Coleman defined social capital “as a variety of entities with two elements in common: They all consist of some aspect of social structure, and they facilitate certain action of actors-whether persons or corporate actors-within the structure” . To be capital a social structure must serve a function for individuals engaged in an activity. The actors exercise control over the resources in which they have an interest and at least partial control of others involved. Social relations are important to facilitating this action by the actors. The concept involved in Social Capital can be related to similar concepts that are drawn from the works of James Madison (The Federalist Papers) and Alexis de Tocqueville (Democracy in America) and their concepts of Civil Society. The relationship between Civil Society and Social Capital was popularized by Robert Putnam with his works on voluntary organization in democratic societies. He argued that social associations and the degree of participation indicate the extent of social capital in a society. Those communities with good government have a high level of volunteer participation in the community, while those communities with weak ineffective governments have low levels of volunteer participation. These associations and participation promote and enhance the collective norms and trust within a community which is central to the collective well-being.