Social Capital

Theory and Research

Rene Dubos

• Publisher: Routledge
• Year: 2017
• Print ISBN: 9781138532700
• eBook ISBN: 9781351490535
• Topic: Social Sciences
• Subtopic: Sociology
• Index: Social Sciences

Leading scholars in the field of social networks from diverse disciplines present the first systematic and comprehensive collection of current theories and empirical research on the informal connections that individuals have for support, help, and information from other people. Expanding on concepts originally formulated by Pierre Bourdieu and James Coleman, this seminal work will find an essential place with educators and students in the fields of social networks, rational choice theory, institutions, and the socioeconomics of poverty, labor markets, social psychology, and race.

The volume is divided into three parts. The first segment clarifies social capital as a concept and explores its theoretical and operational bases. Additional segments provide brief accounts that place the development of social capital in the context of the family of capital theorists, and identify some critical but controversial perspectives and statements regarding social capital in the literature. The editors then make the argument for the network perspective, why and how such a perspective can clarify controversies and advance our understanding of a whole range of instrumental and expressive outcomes.

Social Capital further provides a forum for ongoing research programs initiated by social scientists working at the crossroads of formal theory and new methods. These scholars and programs share certain understandings and approaches in their analyses of social capital. They argue that social networks are the foundation of social capital. Social networks simultaneously capture individuals and social structure, thus serving as a vital conceptual link between actions and structural constraints, between micro- and macro-level analyses, and between relational and collective dynamic processes. They are further cognizant of the dual significance of the "structural" features of the social networks and the "resources" embedded in the networks as defining elements of social c

Part I Social Capital: Networks and Embedded Resources

1 Building a Network Theory of Social Capital

Nan Lin

In the past two decades, social capital in its various forms and contexts has emerged as one of the most salient concepts in social sciences. While much excitement has been generated, divergent views, perspectives, and expectations have also raised the serious question: is it a fad or does it have enduring qualities that will herald a new intellectual enterprise? The purpose of this chapter is to review social capital as discussed in the literature, identify controversies and debates, consider some critical issues, and propose conceptual and research strategies for building a theory. I argue that such a theory and the research enterprise must be based on the fundamental understanding that social capital is captured from embedded resources in social networks. Deviations from this understanding in conceptualization and measurement lead to confusion in analyzing causal mechanisms in the macro- and microprocesses. It is precisely these mechanisms and pro-cesses, essential for a theory about interactions between structure and action, to which social capital promises to make contributions.

I begin by exploring the nature of capital and various theories of capital, so that social capital can be properly perceived and located. I then identify certain controversies which, unless clarified or resolved, will hinder the development of a theory and the research enterprise. By considering social capital as assets in networks, I discuss some issues in conceptualization, measurement, and causal mechanism (the factors leading to inequality of social capital and the returns following investments in social capital). A proposed model identifies the exogenous factors leading to the acquisition (or the lack) of social capital as well as the expected returns of social capital.

What is Capital?

To understand social capital, it is necessary to consider the family of capital theories and trace their historical and conceptual development. A more detailed explication of the concepts of capital and social capital is available elsewhere (Lin 2001). Suffice it here to present a summary of their historical development. The notion of capital can be traced to Marx (1933/1849, 1995/1867, 1885, 1894; Brewer 1984). In his conceptualization, capital is part of the surplus value captured by capitalists or the bourgeoisie, who control the means of production, in the circulation of commodities and monies between the production and consumption processes. In such circulation, laborers are paid for their labor (commodity) with a wage allowing them to purchase commodities (such as food, shelter, and clothing) to sustain their lives (exchange value). But the commodity processed and produced by the capitalists can be circulated to and sold in the consumption market at a higher price (user value). In this scheme of the capitalist society, capital represents two related but distinct elements. On the one hand, it is part of the surplus value generated and pocketed by the capitalists (and their “misers,” presumably the traders and sellers). On the other hand, it represents an investment (in the production and circulation of commodities) on the part of the capitalists, with expected returns in a marketplace. Capital, as part of the surplus value, is a product of a process; capital is also an investment process in which the surplus value is produced and captured. It is also understood that the investment and its produced surplus value refer to a return/reproduction of the process of investment and of more surplus values. It is the dominant class that makes the investment and captures the surplus value. Thus, it is a theory based on the exploitative nature of social relations between two classes. I have called Marx’s theory of capital the classical theory of capital (Lin 2001, Chapter 1).

Subsequent theoretical modifications and refinements have retained the basic elements of capital in the classical theory, as represented in Table 1. Fundamentally, capital remains a surplus value and represents an investment with expected returns. Human-capital theory (Johnson 1960; Schultz 1961; Becker 1964/1993), for example, also conceives of capital as investment (e.g., in education) with certain expected returns (earnings). Individual workers invest in technical skills and knowledge so that they can negotiate with those in control of the production process (firms and their agents) for payment of their labor-skill. This payment has value that may be more than what the purchase of subsisting commodities would require and, thus, contain surplus value that in part can be spent for leisure and lifestyle needs and turned into capital. Likewise, cultural capital, as described by Bourdieu (Bourdieu 1990; Bourdieu & Passeron 1977), represents investments on the part of the dominant class in reproducing a set of symbols and meanings, which are misrecognized and internalized by the dominated class as their own. The investment, in this theory, is in the pedagogic actions of the reproduction process, such as education, the purpose of which is to indoctrinate the masses to internalize the values of these symbols and meanings. Cultural-capital theory also acknowledges that the masses (the dominated class) can invest and acquire these symbols and meanings, even if they misrecognize them as their own. The inference is that while cultural capital is mostly captured by the dominant class through intergenerational transmissions, even the masses (or at least some of them) may generate returns from such investment and acquisition.

Table 1 Theories of Capital^a

a Summary of discussion from Lin (2001, Chapters 1 and 2).

However, these theories break significantly from the classical theory—that is, because the laborers, workers or masses can now invest, and thus acquire certain capital of their own (be they skills and knowledge in the case of human capital, or “misrecognized” but nevertheless internalized symbols and meanings), they (or some of them) can now generate surplus value in trading their labor or work in the production and consumption markets. The social relations between classes (capitalists and noncapitalists) become blurred. The image of the social structure is modified from one of dichotomized antagonistic struggle to one of layered or stratified negotiating discourses. I have called these the neocapitalist theories (Lin 2001, Chapter 1). The distinctive feature of these theories resides in the potential investment and capture of surplus value by the laborers or masses. Social capital, I argue, is another form of the neocapital theories.¹

Why does Social Capital Work?²

The premise behind the notion of social capital is rather simple and straightforward: investment in social relations with expected returns (Lin 2001, Chapter 2). This general definition is consistent with various renditions by scholars who have contributed to the discussion (Bourdieu 1980, 1983/1986; Burt 1992; Coleman 1988, 1990; Erickson 1995, 1996; Flap 1991, 1994; Lin 1982, 1995; Portes 1998; Putnam 1993, 1995a). Individuals engage in interactions and networking in order to produce profits. Generally, four explanations can be offered as to why embedded resources in social networks will enhance the outcomes of actions (Lin 2001, Chapter 2). For one, it facilitates the flow of information. In the usual imperfect market situations, social ties located in certain strategic locations and/or hierarchical positions (and thus better informed about market needs and demands) can provide an individual with useful information about opportunities and choices otherwise not available. Likewise, these ties (or their ties) may alert an organization (be it in the production or consumption market) and its agents, or even a community, about the availability and interest of an otherwise unrecognized individual. Such information would reduce the trans-action cost for the organization to recruit “better” (be it skill, or technical or cultural knowledge) individuals and for individuals to find “better” organizations that can use their capital and provide appropriate rewards. Second, these social ties may exert influence on the agents (e.g., recruiters or supervisors of the organizations) who play a critical role in decisions (e.g., hiring or promotion) involving the actor. Some social ties, due to their strategic locations (e.g., structural holes) and positions (e.g., authority or supervisory capacities), also carry more valued resources and exercise greater power (e.g., greater asymmetry in dependence by these agents), in organizational agents’ decision making. Thus, “putting in a word” carries a certain weight in the decision-making process regarding an individual. Third, social-tie resources, and their acknowledged relationships to the individual, may be conceived by the organization or its agents as certifications of the individual’s social credentials, some of which reflect the individual’s accessibility to resources through social networks and relations—his/her social capital. “Standing behind” the individual by these ties reassures the organization (and its agents) that the individual can provide “added” resources beyond his/her personal capital, some of which may be useful to the organization. Finally, social relations are expected to reinforce identity and recognition. Being assured of one’s worthiness as an individual and a member of a social group sharing similar interests and resources not only provides emotional support but also public acknowledgment of one’s claim to certain resources. These reinforcements are essential for the maintenance of mental health and the entitlement to resources. These four elements—information, influence, social credentials, and reinforcement—may explain why social capital works in instrumental and expressive actions not accounted for by forms of personal capital such as economic capital or human capital³

Perspectives and Controversies in Social Capital

While the fundamental definition of social capital is in general agreed on, two perspectives can be identified relative to the level at which return or profit is conceived—whether the profit is accrued for the group or for individuals. In one perspective, the focus is on the use of social capital by individuals—how individuals access and use resources embedded in social networks to gain returns in instrumental actions (e.g., finding better jobs) or preserve gains in expressive actions. Thus, at this relational level, social capital can be seen as similar to human capital in that it is assumed that such investments can be made by individuals with expected return, some benefit or profit, to the individual. Aggregation of individual returns also benefits the collective. Nonetheless, the focal points for analysis in this perspective are (1) how individuals invest in social relations, and (2) how individuals capture the emebedded resources in the relations to generate a return. Representative works (see review in Lin 1999) can be found in Lin (Lin & Bian 1991; Lin & Dumin 1986; Lin, Ensel, & Vaughn 1981), Burt (1992, 1998, 1997), Marsden (Marsden & Hurlbert 1988; Campbell, Marsden, & Hurlbert 1986), Flap (Boxman, De Graaf, & Flap 1991; De Graaf & Flap 1988; Flap & De Graaf 1988; Flap 1991; Sprengers, Tazelaar, & Flap, 1988; Volker & Flap 1996), and Portes (Portes & Sensenbrenner 1993) as well as in discussions of social capital by Coleman (1990) and Bourdieu (1983/1986).

Another perspective has its focus on social capital at the group level, with discussions dwelling on (1) how certain groups develop and maintain more or less social capital as a collective asset, and (2) how such a collective asset enhances group members’ life chances. Bourdieu (1983/1986, 1980) and Coleman (1988, 1990) have discussed this perspective exten-sively and Putnam’s empirical work (1993, 1995a, 2000) is exemplary. While acknowledging the need for individuals to interact and network to develop payoffs of social capital, the central interest of this perspective is to explore the elements and processes in the production and maintenance of the collective asset. For example, dense or closed networks are seen as the means by which collective capital can be maintained and reproduction of the group can be achieved. Another major interest is how norms and trust, as well as other properties (e.g., sanctions, authority) of a group are essential in the production and maintenance of the collective asset.

Whether social capital is seen from the societal-group level or the relational level, all scholars remain committed to the view that it is the interacting members who make the maintenance and reproduction of this social asset possible. This consensual view puts social capital firmly in the neocapital-theory camp.⁴

However, the divergence in analyzing social capital at different levels has created some theoretical and measurement confusion (Lin 2001, Chapter 2). Further confusion arises from the fact that some discussions have flowed freely between levels. For example, Bourdieu provides a structural view in pointing to the reproduction of the dominant class and nobility groups as the principal explanation of social capital, which is represented by aggregating (1) the size of the group or network and (2) the volume of capital possessed by members (Bourdieu 1983/1986, p. 248). This representation makes sense only when it is assumed that all members maintain strong and reciprocal relations (a completely dense or institutionalized network), so that the strength of relations does not enter into the calculus. Yet, Bourdieu also describes how individuals interact and reinforce mutual recognition and acknowledgment as members of a network or group. Coleman (1990, Chapter 12), while emphasizing how individuals can use sociostructural resources to obtain better outcomes in their (individu...

Table of contents

• Cover Page
• Title Page
• Copyright Page
• Contents
• Preface
• Part I. Social Capital: Networks and Embedded Resources
• Part II. Social Capital in the Labor Market
• Index