Research supports the hypothesis that there is a correlation between high levels of social capital and effective democratic societal institutions. Social capital creates local economic prosperity. For example a study of the relevance of social capital was performed in northern Italy. The regions rich with social capital (networks of co-operation, norms of civic engagement, relationship building and a spirit of trust) enjoyed responsive regional governments and strong economic development. But the regions with poor social capital suffered from unresponsive governments, distrust, and social isolation. Patricia A. Wilson’s work has lent legitimacy to what those involved in community economic development have known intuitively for years: the level of inter-personal trust, civic engagement and organizational capability in a community is key for their social economic development and prosperity. Their research indicates that the lack of, or decline in, social capital lies behind the psychological, spiritual and economic malaise in communities throughout the world. While there is a rich literature deploring the lack of civic commitment and the rise of individualism, the social capital literature gives the issue a more compelling rationale for urgency.
We are seeing the results at a local and regional level. The polarization and lack of collaboration in solving the problems we face has had a direct impact on achieving societal peace and improving our socioeconomic wellbeing. These are the times for stretching the hand, public sector and private sector, political parties, labor and business, churches, ect. and transition from a fear-based to a trust based economy. We have to put our differences of hold and concentrate on the common goods that unite our society.
Our community needs the business to become an integral part of the wealth creation process - which if managed properly should enhance the competitiveness of our economy and maximize the creation of wealth in society.
The concept of social capital brings these same values center stage in the so-called third sector: civil society. Social capital not only produces an atmosphere conducive to economic activity, it provides the culture that will solve community concerns collaboratively. The organizational infrastructure of social capital creates pragmatic skills that enable citizens to act directly to solve problems. Thus block associations, social clubs, civic groups, churches and other grassroots groups may work together to meet social and economic needs that increase the well-being and productive capacity of the members of a community.
Social capital is the combination and collaboration of the whole society working together for a common cause; unfortunately it is a much under-rated asset these days. It is a set of institutionalized expectations that other social actors will reciprocate with cooperative overtures. This expectation generates cooperation by making otherwise untrusting actors willing to undertake those overtures in the first place. To put it in simple terms, (probably too simple) social capital is a social equilibrium that captures the circularity of the relationship between the act of cooperation and the likelihood of mutual collaboration in the future. From the capital to city hall, from business partner to stand alone, from individual practitioners to communities of practice, from facebook to Wikipedia, from teleconferencing to webinars; the creation of social capital has been embraced as a solution for social problems as diverse as urban poverty and crime, economic underdevelopment and inefficient government. Yet despite the wide spread attention it has received the last 20 years, the use of the concept of social capital is still in its infancy.
Social capital is a learnable skill. Building social capital as an organizational and individual competence means providing significant, regular opportunities for training on relationship building and networking ethics, serving others, community projects etc. Inside training and experiential learning are important, but outside is even more important because it provides natural opportunities to build external ties and create structural societal links.
It takes time for individuals and organization to learn to build the social capital competence. Many universities are taking a leadership role in providing the experiences and classroom leanings that will prepare their students to become socially responsible professionals
Individuals, organizations and societies that are best prepared to face the uncertainties of the future are those that among other things are effective in building social capital as a competence.
Copyright 2014, QBS LLC