Download Social capital

Importance of Social Capital
in Sustainable Development
Dr. Shahram Yazdani
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I know that imagination is the most
important creator of wealth in the new
economy.
Tom Peters
Dr. Shahram Yazdani
McElroy’s modified IC map
Market Value
Financial Capital
Human Capital
Intellectual Capital
Social Capital
Structural Capital
Dr. Shahram Yazdani
Human Capital
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uman capital refers to the value of
H
knowledge, skills and experiences held by
individual employees in a firm;
Dr. Shahram Yazdani
Human Capital
Mean Years of
Gross Tertiary
Schooling (>15 years old) Science
Enrollment (%)
Dr. Shahram Yazdani
1

Finland

10.0

27.4
2
United States
12.0
13.9
3
Sweden
11.4
15.3
4
Japan
9.5
10.0
5
Korea, Rep. of
10.8
23.2
6
Netherlands
9.4
9.5
7
United Kingdom
9.4
14.9
8
Canada
11.6
14.2
9
Australia
10.9
25.3
7.1
24.2
10 Singapore
Some non monetary and external
effects of education
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Dr. Shahram Yazdani
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a positive link between one's own schooling and the
schooling received by one's children
a positive association between schooling and the health
status of one's family members
a positive relationship between one's own education and
one's own health status
a positive relationship between one's own education and
the efficiency of choices made, such as consumer choices
which contributes to well-being similar to the increased
money income
a relationship between one's own schooling and fertility
choices in particular, decisions of one's female teenage
children regarding non-marital or early childbearing
a relationship between schooling/social capital of one’s
neighborhood and youth decisions, their level of schooling,
non-marital childbearing, and participation in criminal
activities.
Human Innovation Capital
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Human innovation capital, is the sum total
capacity of individuals to innovate
It is a Subset of Human Capital
Dr. Shahram Yazdani
Human capital is embodied in the individual
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As usually defined, human capital is
embodied in the individual, and the
national stock of human capital can
therefore be thought of as the sum total of
the human capital of all those normally
resident in its territory.
Dr. Shahram Yazdani
Human Innovation Capital
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However the creation of knowledge is
clearly a social activity so it is necessary
to ask whether a simple aggregation of
the human capital possessed by
individuals is sufficient.
Dr. Shahram Yazdani
Human Innovation Capital
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Dr. Shahram Yazdani
The development of individual human
capital is therefore intertwined with the
social and collective development of
knowledge.
Human capital and knowledge can be
thought of as joint-products, but
conceptually, they are distinct and in the
ideal would be separately measured.
Social capital
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Dr. Shahram Yazdani
Social capital points to the value of
relationships between people in firms, and
between firms and other firms. Trust,
reciprocity, shared values, networking,
and norms are all things that, according to
social capital theory, add value in a firm,
or between firms, by speeding the transfer
of information and the development of
new knowledge.
Dr. Shahram Yazdani
Human Capital
Social Capital
Focus
Individual Agent
Relationships
Measures
Duration of Schooling,
Qualifications
Attitudes
Membership, Participation,
Trust Level
Outcomes
Direct: Income, Productivity
Indirect: Health, Civic
Activity
Social Cohesion
Economic Achievement
More Social Capital
Model
Linear
Interactive, Circular
Types of social capital
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Three main types of social capital can be
distinguished :
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Dr. Shahram Yazdani
Bonding social capital (e.g. among family
members or ethnic groups);
Bridging social capital (e.g. across ethnic
groups); and
Linking social capital (e.g. between different
social classes);
The components of social capital
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Social networks - who knows who;
Social norms - the informal and formal
“rules” that guide how network members
behave to each other; and
Sanctions - the processes that help to
ensure that network members keep to the
rules.
Dr. Shahram Yazdani
Social capital benefits
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Social capital may contribute to a range of
beneficial economic and social outcomes
including : high levels of and growth in
GDP; more efficiently functioning labor
markets; higher educational attainment;
lower levels of crime; better health; and
more effective institutions of government;
Dr. Shahram Yazdani
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Different types of social capital are
relevant to different economic and social
outcomes e.g. bonding social capital is
most important to health in early
childhood and frail old age whereas
bridging social capital is most important in
adult life when looking for employment;
Dr. Shahram Yazdani
Trends of social capital
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Dr. Shahram Yazdani
There is evidence that overall levels of social
capital have been declining in countries such as
the United States and Australia.
Overall levels of social capital have generally
been stable or rising in countries such as the
Netherlands, Sweden, Japan and Germany;
The evidence for the UK is ambiguous, with
some key indicators showing declines, such as
social trust, while others appear to have
remained stable, such as volunteering;
What determine the level of social capital ?
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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;
Dr. Shahram Yazdani
Promoting the accumulation of social
capital
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At the individual level, the available levers include (for example) :
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At the community level, the available levers include (for example) :
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greater support for families and parenting;
mentoring;
new approaches to dealing with offenders; and
volunteering.
promoting institutions that foster community;
community IT networks;
new approaches to the planning and design of the built environment;
dispersing social housing; and
using personal networks to pull individuals and communities out of
poverty.
At the national level, the available levers include (for example) :
Dr. Shahram Yazdani
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service learning in schools;
community service credit schemes; and
measures to facilitate mutual trust.
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Social capital can be measured using a
range of indicators but the most
commonly used measure is trust in other
people;
Dr. Shahram Yazdani
Social trust

Social trust is a core component of social
capital, and is normally used as a key
indicator of it, sometimes as the best or
only single indicator.
Dr. Shahram Yazdani
Level of trust in different countries
Most people can be trusted (%)
Dr. Shahram Yazdani
South Korea
60
Switzerland
43
East Germany
35
West Germany
32
Spain
28
Hungary
18
Slovenia
14
Percentage of People Saying that Most
People can be Trusted.
Dr. Shahram Yazdani
Social Cohesion
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Cohesion is defined as a "field of forces
that act on members to remain in the
group" or "the resistance of a group to
disruptive forces"
Dr. Shahram Yazdani
Social Cohesion
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Dr. Shahram Yazdani
A collectivity is structurally cohesive to the
extent that the social relations of its
members hold it together.
Individuals may be embedded more or
less strongly within a cohesive group, but
if the maximum-sized group at a given
level of strength is uniquely well defined,
then the individuals and the group have a
unique level of cohesion.
Social Cohesion
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The presence of multiple paths, passing
through different actors, implies that if any one
actor is removed, alternative linkages among
members still exist to maintain social solidarity
A group is strongly (as opposed to weakly)
structurally cohesive to the extent that multiple
independent social relations among all pairs of
members of the group hold it together.
Dr. Shahram Yazdani
Dimensions of social cohesion
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Belonging vs. Isolation
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Inclusion vs. Exclusion
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Which concerns equal opportunities of access
Participation vs. Non-involvement
Recognition vs. Rejection
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Which means shared values, identity, feeling of
commitment
Which addresses the issue of respecting and
tolerating differences in a pluralistic society
Dr. Shahram Yazdani
Legitimacy vs. Illegitimacy
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With respect to the institutions acting as mediator in
conflicts of a pluralistic society
Social innovation capital
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Social innovation capital is the collective
capacity of a group to innovate.
It originate from human innovation capital
and social capital
Dr. Shahram Yazdani
Social Innovation Capital
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Collection of independent learners and
communities of practice who collaborate
with one another in self-organizing ways
to develop and integrate shared
knowledge.
Dr. Shahram Yazdani
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“Human and social capital are closely related to
the way in which institutions and political and
social arrangements impact on society.
However the various elements need to be
carefully distinguished, since:
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Dr. Shahram Yazdani
“Human capital resides in individuals.
“Social capital resides in social relations.
“Political, institutional and legal arrangements
describe the rules and institutions in which human
and social capital work”
Structural capital
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Structural capital consists of embodiment,
empowerment, and supportive
infrastructure of an organization that
enhances performance of human capital.
Dr. Shahram Yazdani
Structural innovation capital
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Structural innovation capital is the value
of supportive infrastructure of an
organization that enhances and increases
the capacity of a group to innovate.
Structural innovation capital is a subset of
structural capital
Dr. Shahram Yazdani
Innovation Capital
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Innovation capital is the collective
capacity of an organization to innovate
It includes
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Human innovation capital
Social innovation capital and
Structural innovation capital
Dr. Shahram Yazdani
Innovation capital is a subset of
intellectual capital
Social Capital
Social Innovation Capital
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Human Capital
Human Innovation Capital
Structural Capital
Structural Innovation Capital
Social Capital
Social Innovation Capital
Human Capital
Human Innovation Capital
Structural Capital
Structural Innovation Capital
Social Innovation Capital
Human Innovation Capital
Innovation Capital
Innovation capital is the collective capacity of an organization to innovate
Structural Innovation Capital
Innovation Capital
Dr. Shahram Yazdani
Rank
Economy
value added per capita index
1
Switzerland
1
2
United States
0.873
3
Japan
0.851
4
Sweden
0.673
5
Germany
0.655
6
Finland
0.645
7
Canada
0.585
8
France
0.539
9
Austria
0.529
10
Norway
0.491
Innovation Capital
Dr. Shahram Yazdani
Rank Economy
Manufactured Exports Per capita Index
1
Switzerland
0.760
2
Singapore
0.717
3
Sweden
0.562
4
Belgium
0.521
5
Japan
0.518
6
Finland
0.490
7
United States
0.481
8
Germany
0.466
9
Canada
0.451
10
Netherlands
0.431
Innovation Capital
Dr. Shahram Yazdani
Rank Economy
Share of medium- and high-tech
activities in manufacturing value added
Index
1
Switzerland
0.840
2
Japan
0.633
3
Sweden
0.627
4
Singapore
0.616
5
Germany
0.592
6
United States
0.551
7
Finland
0.523
8
Belgium
0.491
9
Canada
0.448
10
Denmark
0.420
Innovation Capital
Dr. Shahram Yazdani
Rank Economy
Share of medium-tech and high-tech
products in Manufactured Exports final
index
1
Switzerland
0.808
2
Japan
0.725
3
Germany
0.635
4
Sweden
0.633
5
United States
0.599
6
Singapore
0.587
7
Finland
0.494
8
Belgium
0.489
9
Canada
0.474
10
France
0.450
Innovation Capital
Complex Exports
Simple Exports
High tech
Medium Tech
H & M Tech
High tech
Medium Tech
H & M Tech
Dr. Shahram Yazdani
1
Japan
29.6
51.5
81.1
8.0
6.3
14.3

2
Philippines
64.3
10.4
74.7
13.8
6.9
20.7
3
Singapore
56.7
17.6
74.3
6.6
13.3
19.9
4
Mexico
26.6
38.9
65.5
16.9
5.9
22.9
5
United States
31.0
34.4
65.4
10.1
11.1
21.2
6
Malaysia
46.9
18.2
65.1
9.9
15.0
24.9
7
Germany
17.1
47.7
64.8
13.7
11.2
24.9
8
Switzerland
23.2
39.7
62.9
15.4
16.4
31.8
9
United
Kingdom
28.2
34.7
62.9
12.4
14.2
26.7
10
Korea,
Republic of
27.2
35.1
62.3
19.1
9.8
28.9
11
Taiwan
35.0
26.3
61.3
29.1
5.3
34.3
Innovation Capital
Technology
Achievement Index
Patents per
Million People
Dr. Shahram Yazdani
1

Finland

0.744

187

2
United States
0.733
289
3
Sweden
0.703
271
4
Japan
0.698
994
5
Korea, Rep. of
0.666
779
6
Netherlands
0.630
189
7
United Kingdom
0.606
82
8
Canada
0.589
31
9
Australia
0.587
75
0.585
8
10 Singapore
Market Value
Financial Capital
Human Capital
Intellectual Capital
Social Capital
Structural Capital
Dr. Shahram Yazdani
Thank you!
Any Question?
Dr. Shahram Yazdani