Download Contemporary Social Sciences in the West: A Critical Perspective

Social Capital and Development
Norman Uphoff, Cornell University
Open Research Center (ORC),
Ryokoku University,
Kyoto, July 26, 2003
What Is Social Capital?
• Social Capital is currently a fashionable concept
in social science and in development agencies
• For many years, I avoided the concept because of
its ambiguities and imprecisions
• After doing an analysis, with Anirudh Krishna, of
Social Capital in the Indian State of Rajasthan
where we evaluated its contribution to improving
‘watershed management,’ and after I rethought
my own work with Sri Lankan colleagues in
introducing participatory management in the
Gal Oya irrigation system, I think it has merit
What Is Social Capital?
• To be useful, Social Capital needs to be
understood in terms of what it is -- not just
considering examples or similarities
• Social Capital should be understood within given
cultural and institutional contexts, not presented as
having universal content -- it can have universal
relevance, but not always the same substance
• Social Capital is not the same thing as its
consequences -- we need to distinguish between
causes and effects
Conceptualizing Social Capital
What are the basic features of ‘capital’ in general?
• Capital is now considered as more than physical
capital -- more than machines, infrastructure, etc.
1) Does capital require investment? No
Natural resources are inherited, not created
2) Does capital always have depletion from use? No
Renewable natural resources are maintained when
used within certain limits -- at sustainable rates;
Human resources can be improved through use
• While investment and depletion are important
issues, they are not defining criteria for ‘capital’
Conceptualizing Social Capital
• To speak in general terms, CAPITAL = ASSETS,
things that are valued for their productive potentials
• ASSETS yield a stream of benefits over time
• CAPITAL = a STOCK, while Benefits = a FLOW
• Income or benefit streams results from Capital
• All forms of Capital produce some flow of benefits;
they may require investment, and may be depleted
• Both Capital & Resources increase PRODUCTIVITY
• But Capital  Resources -- since latter are used up in
the production process; Capital can be accumulated
Main Kinds of Capital
• PHYSICAL capital = INFRASTRUCTURE such as
road network and telecommunication system, power
generation and distribution; FACILITIES for
production, e.g., factories, machines, etc.
• FINANCIAL capital = stocks, bonds, money, etc.
• NATURAL capital = petroleum, minerals, forests,
fisheries, soil, flora and fauna, microbes, etc.
• HUMAN capital = labor power, talent, creativity
• SOCIAL capital = factors that contribute to
mutually beneficial collective action (MBCA)
Main Kinds of Capital
• Different kinds of capital can be accumulated -i.e., increased by purposeful actions
• All kinds of capital can be diminished through
certain actions or circumstances
• All yield certain flows of benefits, and resources
can be reinvested to augment capital stock or to
replenish this stock
• Sustainable development = development that
enhances capital stocks rather than depletes them
Subcategories of Capital
• FINANCIAL Capital -- fixed vs. liquid assets
• PHYSICAL Capital -- infrastructure vs. directly
productive assets (yielding final products = G/S)
• NATURAL Capital -- renewable vs. non-renewable
• HUMAN Capital -- skilled vs. unskilled labor
• SOCIAL Capital -- structural forms that facilitate
mutually beneficial collective action (MBCA) with
lower transaction costs vs. cognitive forms that
predispose people toward MBCA -- same difference
as ‘able’ vs. ‘willing’ -- both are important
Mutually Beneficial
Collective Action (MBCA)
• Why define the ‘income stream’ (flow of benefits)
from Social Capital in this way?
• Collective Action can produce benefits that
individual uses of other forms of capital cannot
• So those things that enable or encourage people to
cooperate produce streams of benefit worth
considering and promoting in their own right
• Concern with ‘mutual benefit’ derives from the
concept of what is ‘social’ (word derives from the
Latin word for ‘friend,’ implying ‘friendship’)
First Kind of Social Capital
• ‘STRUCTURAL’ Social Capital derives from
networks of relationships among persons that are
maintained for mutual benefit
• The main forms of Structural Social Capital are:
–
–
–
–
ROLES
RULES
PRECEDENTS, and
PROCEDURES
that facilitate mutually beneficial collective action
Structural Social Capital
• These forms of Social Capital can be added to or
revised or improved so as to facilitate MBCA
• Roles can be created
• Rules can be formulated
• Precedents can be set by certain decisions
• Procedures can be established
These can become more or less effective for facilitating
MBCA, by lowering or raising transaction costs
They can be invested in, and they can be depreciated
or diminished
Second Kind of Social Capital
• ‘Cognitive’ Social Capital comes from shared ways
of thinking and evaluating among persons, leading
to MBCA for mutual benefit
• The main forms of Cognitive Social Capital are:
–
–
–
–
NORMS
VALUES
ATTITUDES, and
BELIEFS
that predispose people to engage in and to sustain
mutually beneficial collective action
These Kinds of Social Capital
• Are INTERACTIVE -- mutually reinforcing each
other, not separate or simply parallel
• However, they are analytically distinguishable:
as seen from a simple example (thought experiment)
• Imagine a rural community in Japan or anywhere
else, where a house burns down during the night
• What happens the next morning?
• If little or no social capital, the household must
begin putting its property and life back together
all by itself, with no assistance from others
Where There Is Social Capital
• ROLES -- Village headman, Emergency Committee
• RULES -- Temporary exemption from taxation?
• PRECEDENTS -- Each household contributes
something to restoring the house and its goods?
• PROCEDURES -- How resources will be given?
• These can get the household’s rehabilitation started
quickly and efficiently -- no need for meetings or
consultations -- relief work starts automatically
• What if there is no Structural Social Capital?
With Cognitive Social Capital
Can get MBCA without Structural Social Capital:
• NORMS -- Reciprocity, e.g. -- assistance should be
rendered, and reciprocated, whenever it is needed
• VALUES -- Generosity toward others in need is a
virtue, to be respected and praised
• ATTITUDES -- Trust; assisting neighbors builds
community solidarity, which is good for everyone
• BELIEFS -- “There but for the grace of God go I”
• Villages could contribute materials and other aid on
an ad hoc basis, but it would be less efficient
‘Incomplete’ Social Capital?
Can there be just Cognitive Social Capital without
Structural Social Capital? Or vice versa?
Possible, but unlikely -- Structural Social Capital gives
effect to Cognitive Social Capital; and Cognitive
Social Capital underlies Structural Social Capital
• Analytically these forms can be distinguished; can
have ‘investment in’ Cognitive Social Capital, and
‘depletion of’ Cognitive Social Capital, just as with
Structural Social Capital
• But in practice, the two forms always INTERACT
Example from Cambodia
Survey of the situation of the rural elderly population
during reconstruction (for HelpAge, UK NGO)
Elderly Khmers reported a local tradition (institution)
that they did not particularly appreciate:
• Whenever villagers became involved in disagreement
that could lead to conflict, they should identify the
oldest person around and ask him/her to mediate the
conflict, to avoid possibility of violence
• Elderly Khmer were very uncomfortable doing this
because rural society was now more violence-prone
Example from Cambodia
What were the elements of Social Capital here?
ROLE: Dispute mediator, to be filled automatically by
oldest person available who should hear the dispute
and give an impartial judgment
Various RULES, PRECEDENTS, PROCEDURES
were understood to apply to this process
NORM AND VALUE: Avoidance of conflict
ATTITUDES AND BELIEFS: Respect for age
RESULT: Mutually beneficial collective action, which
had survived the disruption of Khmer Rouge rule
Example from Japan
Ancient form of Social Capital: the Kumi
Groupings of about 10 households,
with a designated (rotating) chairman
(male head of household)
Collective responsibility for actions of Kumi members
Designed as instrument for control from above -served as instrument for collective action from below
Self-help, protection, insurance against disaster,
resource mobilization, etc. = SOCIAL CAPITAL
Example from Japan
STRUCTURAL SOCIAL CAPITAL
• Roles -- Kumi leader, and Kumi member -- created
mutual expectations, coordinated efforts
• Rules -- governing behavior, contributions, etc
• Precedents and Procedures-- local problem-solving
COGNITIVE SOCIAL CAPITAL
• Norms -- reciprocity, cooperative behavior
• Values -- solidarity, peaceful resolution of conflict
• Attitudes and Beliefs -- mutual self-help
Example from Nepal
Chhattis Mauja traditional irrigation system (terai):
• Roles -- elected chairman and secretary, branch
associations and chairmen, messengers, technicians
• Rules, Precedents and Procedures -- annual meeting,
resource contributions, fines, schedules, etc.
COGNITIVE SOCIAL CAPITAL
• Norms -- per person contributions (all equal voice)
• Values -- efficient distribution, technical solutions
• Attitudes and Beliefs -- no caste or ethnic advantage
Example from Sri Lanka
GAL OYA IRRIGATION PROJECT -- introduction of
‘participatory irrigation management,’ 1981-85
STRUCTURAL SOCIAL CAPITAL
• Roles -- Farmer-Representative and members of
farmer organizations; multi-level structure
• Rules -- regulating water distribution, etc.
• Precedents and Procedures-- preventive maintenance
COGNITIVE SOCIAL CAPITAL
• Norms -- equitable sharing of water, participation
• Values -- solidarity, resolutions of conflict, etc.
What To Do about Social Capital?
• RECOGNIZE Social Capital for what it is -- an
ASSET that is valuable and worthy of appreciation
• PRESERVE/CONSERVE Social Capital where it
exists, reinforcing institutions and thinking that are
supportive of mutually-beneficial collective action
• INVEST in Social Capital to increase its stock -(a) in institutions (roles, rules, precedents and
procedures) and (b) in shared thinking (norms,
values, attitudes and beliefs) that facilitate MBCA or
are conducive to MBCA
Who Can Support Social Capital?
• ACADEMICS can do research and evaluation to
improve understanding of Social Capital (their own
understanding and that of others)
• OFFICIALS can learn more about Social Capital
and can work with it and reinforce it by ensuring its
effectiveness
• POLICY MAKERS can invest in institutions and can
set good examples for MBCA, acting for common
interest, demonstrating benefit from collective action
• INDIVIDUALS can make their own investments
How to Invest in Institutions?
Identify opportunities (gaps) for building up
institutional capacity -- four basic functions:
• Decision-making
• Resource mobilization and management
• Communication and coordination
• Conflict resolution
Each of these is facilitated by ROLES, RULES,
PRECEDENTS and PROCEDURES
Each can be reinforced by appropriate NORMS,
VALUES, ATTITUDES and BELIEFS
How to Invest in Shared Thinking?
National, regional and local political leadership
• Set good examples of action for common interests
• Articulate the values, norms, attitudes and beliefs
that are supportive of MBCA
• Encourage demonstrations of solidarity, trust etc.
These should be reinforced by religious, educational,
civic, business and other leaders acting similarly
Individuals and local groups
• Demonstrate merits of MBCA by visible practice
• Promote discussions and articulation of norms, etc.
What Is the Future of Social Capital?
Social Capital depends on the actions and thinking of
both leaders and members of the public
Japan has long been regarded as ‘rich in Social Capital’
although the concept has been poorly understood
Other countries have often been well-endowed with
Social Capital, but their stocks of this asset are now
often declining, as the norm of individualism increases
Social Capital is only one form of capital, but it a very
productive and cost-effective asset for development
No need to lose it, and many good reasons to increase it