Social Capital and Development: Concepts, Evidence and Applications

1
Social Capital and Development Concepts,
Evidence and Applications

• Michael Woolcock
• World Bank and Harvard University
• Workshop on Understanding and Building Social
  Capital in Croatia
• Zagreb, 6 March 2002

2
Overview

• Development What is to be explained?
• Sorting out the socials
• Social capital in poor communities
• Dimensions of social capital
• Combinations of dimensions
• Managing the transitions
• Applications to projects and policy
• Implications for development agencies
• Significance for Croatia

3
What is to be explained?

• Development as economic growth?
• Development as greater equality?
• Development as freedom?
• Development as transition management
• Non-linear, problematic, not inevitable
• Shifts in identities, institutions, ideas
• True for individuals, communities, countries
• What is the role of social capital?

4
Sorting out the socials

• Social capability
• Quality of communications, transport
  infrastructure
• Social exclusion
• Who does not have access to government services
  and market opportunities?
• Social cohesion
• A societys level of economic inequality, ethnic
  diversity, and political unity
• Social capital

5
Defining social capital

• Narrow approachesindividuals
• Broad approachescountries
• Emerging consensusNorms and networks
  facilitating collective action
• An important asset of the poor
• Physical capital plough, sewing machine
• Human capital metis, local knowledge
• Can be used for good or ill
• 9/11 planes flight school networks

6
Social capital in poor communities

• What is its role?
• Exchanging information and ideas
• Enhance quality and quantity of dissemination
• Greater transparency, accountability, credibility
• Overcoming asymmetric information problems
• Informal monitoring and enforcement of contracts

7
Social capital in poor communities

• Improving coordination and cooperation
• Resolving collective action problems
• Managing conflict (into constructive resolutions)
• Managing common pool resources
• Improving organizational performance
• Public, private, civic partnerships (synergy)

8
Social capital in poor communities

• Managing risk and opportunity
• Survival strategiesgetting by
• finding housing, employment
• informal insurance, savings
• credit from friends, relatives
• elaborate weddings, ceremonies (irrational?)
• Mobility strategiesgetting ahead
• migration, remittances
• improving housing, employment
• group-based microfinance programs
• leveraging external resources (new suppliers,
  markets)
• gaining access to public services (legal aid,
  citizenship)

9
Social capital in poor communities

• Understanding how context matters
• Norms and networks as a
• source of identity and support
• potential asset, point of articulation for
  outsiders
• but also a mechanism for perpetuating
• elite capture
• discrimination, sense of hopelessness, limited
  aspirations
• Failure and success will generate conflict
• either way, need to manage transitions
• money changes everything

10
Dimensions of social capital

• Bonding
• connections to people like you
• (similar to, but not synonymous with, strong
  ties)
• associated with survivalgetting by
• Bridging
• connections to people not like you
• (similar to, but not synonymous with, weak
  ties)
• associated with mobilitygetting ahead
• Linking
• connections to people in positions of power
• used to leverage resources
• access to banks, courts, agricultural extension

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Linking
Bridging
Bonding
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Effects of different combinations

• Different combinations, different outcomes
• No bonding, bridging, linking outcasts, hermits
• Bridging linking - bonding workaholics
• Bonding bridging - linking illegal immigrants
• Bonding bridging linking assimilated
  immigrants
• Bonding - bridging - linking the poor
• Bonding linking - bridging clientilism,
  corruption
• Gender, rural/urban differences
• Women bond, men bridge/link
• Rural high bonding, low bridging, no linking
• Urban low bonding, high bridging, some linking

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Making the transitions
b
Income
c
a
Diversity of network
14
Making the transitions
E
b
Income
F
c
a
D
Diversity of network
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Applications to projects, policy

• Begin with existing social resources, skills
• potential asset, but also potential liability
• Diversify access to markets
• better information, lower risk
• Enhance political leverage
• Stronger voice, access to state services
• Goal Social sustainability
• role of external agent
• inspire confidence, competence to bridge link
• build new organizations and linkages that endure
  in absence of external agent, funding
• if successful move on, repeat process

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Implications for Development Agencies

• Better service delivery
• Delhi, Jakarta, Chicago
• Better project impacts
• Bangladesh, Indonesia, Canada
• Better data, poverty assessments
• Guatemala, Brazil, Ireland

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Significance for Croatia

• Better understanding of
• Survival and mobility strategies
• Indigenous communities
• Isolated, marginalized communities
• Migrants, assimilation process
• What makes for happiness, well-being
• Anticipating, managing transitions
• Personal
• Community
• National
• Expanding the we (Who is us?)