Social Capital can be defined as the accumulation of collective knowledge of organizational culture, solidarity, mutual trust and creative institutional functioning and develops social skills. Social networks and volunteering are the key factors for its formation. Social capital largely complements and replaces the financial capital necessary for investment, creating confidence in transactions and cost reduction as well as creditworthiness. According to corresponding studies, social capital is a concept inherent in the social structure, facilitates individual action and gives meaning to collaborations and social development partnerships.
In other words, Social Capital creates an accumulation of social forces that contributes to the creation of social entrepreneurship.
In recent years, the gradual awareness that neither the state nor the market can solve, exclusively, the economic and social problems but also the employment arrhythmias has brought to the fore the concept of social capital, which bridges the public with the private sphere. Tony Blair was the first European politician to use the term in 1995,
The term “social capital” is increasingly used as a concept intertwined with civil society, but is not limited to it, as it includes both formal and informal social networks and common values. Woolcock (1998)’s definition that social capital encompasses all values and networks that facilitate group action is based on this very interaction with civil society. In the international debate, the connection of non-governmental organizations with the concept of “civil society” is made mainly with reference to the Tocqueville example, which we mentioned above, according to which “civil society” is a place where organized citizens exercise their freedom. to cooperate as an institutional counterweight to state authoritarianism, as a force of democratization “from below”, as a “school of democracy”, as a method of producing “social capital” and even as a vehicle for social actions that contribute to the “common good”.
More simply, the continuous upgrade in relation to the provision of services by the Civil Society Organizations forms, gathers and develops the “social capital” which is none other than the cooperation, volunteering and solidarity institutions that while not aiming at profit , contribute to social income and bring social benefit and employment by integrating social corporate responsibility.
In this light, Social Capital can be defined as the accumulation of collective knowledge of organizational culture, solidarity, mutual trust and creative institutional functioning and develops social skills. Social capital largely complements and replaces financial capital in investment, building trust and creditworthiness, is a fundamental value that is co-operated by civil society organizations, social networks and solidarity institutions, contributes decisively to green and political entrepreneurship but also in social solidarity, is the basic condition for the development of the social economy and has common features with other forms of capital, because one can invest in it in order to reap benefits later
Social Capital is not the property of an organization, a business, the market or the state, although everyone can contribute to its creation. It is a process “from below” and concerns citizens, of the same or different origin and culture, who are socially connected and create networks and associations. According to the World Bank definition, social capital is the cohesive “glue” that holds societies together. It is a matter of socialization, trust and cooperation at the local level but also a capacity for innovative investment policies that move society forward, including the whole web of relationships, institutions and rules that shape the quality of social interrelationships and benefits and has the same weight as economics. natural or human capital in a world with a rational economic view.
Global organizations now recognize the important multiplier role of social capital, volunteering and CSOs and provide incentives for their development. Modern progressive politics, business and local government have many important reasons to invest in the development of social capital. For example, the World Bank itself often collaborates with governments to seek opportunities to plan and execute its financing programs with the participation of non-governmental organizations and to utilize an area’s social capital. Instead, the lack of required social capital must be made up for in other ways, usually through time-consuming negotiations and a number of complex regulations and legal arrangements, which cost time and money and are essentially an indirect form of taxation.
According to the World Bank, which conducts research using quantitative data collection methods and analyzes the trust and solidarity of groups and networks, collective action, cooperation and political participation, there is measurable evidence that, at a macroeconomic level, migration trade, economic reforms, economic growth, security, and even the impact of new technologies. influenced by the interaction between people and in short, concludes that social capital, while belonging to the microeconomy, even affects macroeconomic factors. So social capital can be measured, and at the same time the benefits it entails can be calculated.
Social capital reduces the cost of adjusting a local investment and therefore reduces the cost of exchanges. In this sense, the existence of a structured social capital, ie a solidarity civil society, facilitates the inflow of financial capital and then facilitates the sustainability of investments for the benefit of the community. Thus, given the approaches to economic development based on social capital theories, we can explain why certain geographical regions and countries have such different degrees of development and understand, as a point, the economic backwardness of countries with a long tradition. statehood and limited civil society versus others. In this light, differences in the degree of development are not justified solely on the basis of the starting point of the economy but are influenced by the existence or not of social capital, ie an organized and active civil society.
According to similar studies, social capital is a concept inherent in the social structure, facilitates individual action and gives meaning to it in the social context. At the same time, social capital consists of overlapping social networks, which have common values, trust and common decision criteria.
Looking for the particular characteristics of social capital and organized civil society we would say that the criterion of trust is the comparative advantage over communities without cohesion. In networks with a high level of social capital, the principle of reciprocity and solidarity that contributes to individual well-being prevails, as participants have easier access to information or other resources, which increase the opportunities for individual integration.
In this sense there are three basic parameters that maximize social capital:
Trust, which is built through social networks and ensures that the obligations and duties of members will be handled smoothly
The information, which is channeled through social networks and the regulations and sanctions imposed on the members of the networks, and
Cooperation, ensured by human communities.
Although social capital has many features in common with other forms of capital, it is radically different in that its creation presupposes an interaction between a large group of people. The relevant literature has shown that this is a complex process influenced by historical, social, political and cultural factors, as well as the dominant model of economic development. Social Capital increases when people collaborate in voluntary organizations and when they communicate with each other this is achieved by:
Voluntary participation in networks, individuals or groups, on the basis of equality of members. Social capital concerns horizontal relations between members of the community and the family but also vertical relations between the communities and the various institutions and bodies and governments. A relevant theory, known as “Network Theory”, has also been developed.
Reciprocity: Individuals provide services to others or act for the benefit of others at personal cost, expecting, in general and indefinitely, that there will be reciprocity at an indefinite time in the future, when they themselves will need it. In other words, a combination of short-term altruism and long-term interest is created.
Trust: Trust allows you to take risks when there is a belief that others will react positively and supportively or at least not undermine the initiative.” Trust is extremely important even at the state level, where the greater the social consensus, that is, the greater the trust between the social partners, the greater the country’s progress.
Rules (norms): Usually unwritten but understandable social rules and principles that provide the framework for informal social control, without resorting to institutional sanctioning procedures. Many argue that where there is strong social capital, crime and the need for policing are low.
Community: The combined effect of trust, networks, rules, and reciprocity creates a strong community capable of averting the risk of any prospective opportunist attempting to exploit the community’s social capital without offering it. The community is not owned by anyone, but is used by everyone. Only where there is a strong ethos of trust, reciprocity and effective social sanctions against offenders and “invaders” can the community be perpetuated for the benefit of all.
Human and Social Capital: As we have already analyzed, human capital represents valuable resources, such as the knowledge and skills derived from education, training and experience. Some types of human capital, such as teamwork and communication skills, work in support of social capital. Investments in human capital therefore contribute to the development of both types of capital.
In examining the role of social capital it is useful to consider the three basic types of social capital, as identified by experts:
- BONDING: The bonds between family members, members of the same group, or friends (Those familiar).
- BRIDGING: Bridging differences and interacting between different ethnic groups, ages, partners or states. (Intercultural cooperation).
- LINKING: The connection and vertical communication between different and different social and / or political levels. (Customer Relationship).
So far we have mentioned only the positive elements of social capital. However, the relevant literature, as well as the experience we all have from our daily lives, reveals that a series of unfortunate manipulations can cause the devaluation of social capital, as it can happen with other forms of capital. It is a common finding that problems often arise when a group uses its capital against others for reasons of narrow personal or selfish interest. It is therefore necessary to be aware of its possible negative aspects when it comes to designing policies for the development of social capital, especially when one wants to shed light on the positive and negative aspects of social capital.
A classic example of the devaluation of social capital are networks or associations set up to promote narrow trade union interests, which undermine the general interest and social well-being. After all, two centuries ago, the great economist Adam Smith had warned that people of the same profession or art have the power to conspire against the public interest and to manipulate in order to raise prices or manipulate the market. In more recent times, Markur Olson (1982) has also pointed to the action of trade unions and lobbying organizations that make economies less efficient.
It is therefore necessary to distinguish between social capital as a public good and social capital as a lobby that promotes the interests of one group to the detriment of others. So, in order for social capital not to become ultimately anti-developmental, it must be diffused into society as a whole. The reservations certainly apply to a wide range of activities, from trade unions to charities as well as all sorts of vertical relationships, especially between citizens or organizations, with political networks and parties that often end in client relationships. Speaking of negative social capital, we must not forget the international criminal and terrorist networks – mafia or al caida – which use their capital to serve their criminal purposes.
The great challenge for the research and theory of social capital is to identify and highlight the terms and conditions under which its many positive aspects can be exploited and at the same time to reduce or eliminate the negative ones that are significantly less.
