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An Economic Approach to Social Capital

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Author Info
Edward L. Glaeser (Harvard University, Dartmouth University and NBER)
David Laibson (Harvard University, Dartmouth University and NBER)
Bruce Sacerdote (Harvard University, Dartmouth University and NBER)

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Abstract

A standard optimal investment model can be used to analyse an individual"s decision to accumulate social capital. We analyse six facts that support the predictions of this individual--based approach: (1) social capital first rises and then falls with age, (2) social capital declines with expected mobility, (3) social capital rises in occupations with greater returns to social skills, (4) social capital is higher among homeowners, (5) social connections fall sharply with physical distance, (6) people who invest in human capital also invest in social capital. We fail to find robust evidence that social capital investments fall with the value of time or that geographic/religious groups generate social capital complementarities. Copyright Royal Economic Society 2002

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Article provided by Royal Economic Society in its journal The Economic Journal.

Volume (Year): 112 (2002)
Issue (Month): 483 (November)
Pages: 437-458
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Handle: RePEc:ecj:econjl:v:112:y:2002:i:483:p:437-458

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  1. Edward P. Lazear, 1999. "Culture and Language," Journal of Political Economy, University of Chicago Press, vol. 107(S6), pages S95-29, December. [Downloadable!] (restricted)
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  2. Glenn C. Loury, 1976. "A Dynamic Theory of Racial Income Differences," Discussion Papers 225, Northwestern University, Center for Mathematical Studies in Economics and Management Science. [Downloadable!]
  3. Luigi Guiso & Paola Sapienza & Luigi Zingales, 2000. "The Role of Social Capital in Financial Development," NBER Working Papers 7563, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  4. John F. Helliwell & Robert D. Putnam, 1999. "Education and Social Capital," NBER Working Papers 7121, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  5. Abreu, Dilip, 1988. "On the Theory of Infinitely Repeated Games with Discounting," Econometrica, Econometric Society, vol. 56(2), pages 383-96, March. [Downloadable!] (restricted)
  6. DiPasquale, Denise & Glaeser, Edward L., 1999. "Incentives and Social Capital: Are Homeowners Better Citizens?," Journal of Urban Economics, Elsevier, vol. 45(2), pages 354-384, March. [Downloadable!] (restricted)
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  7. Alberto Alesina & Eliana La Ferrara, 2000. "Participation In Heterogeneous Communities," The Quarterly Journal of Economics, MIT Press, vol. 115(3), pages 847-904, August. [Downloadable!] (restricted)
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  8. Kreps, David M. & Milgrom, Paul & Roberts, John & Wilson, Robert, 1982. "Rational cooperation in the finitely repeated prisoners' dilemma," Journal of Economic Theory, Elsevier, vol. 27(2), pages 245-252, August. [Downloadable!] (restricted)
  9. Samuel Bowles & Herbert Gintis & Melissa Osborne, 2001. "The Determinants of Earnings: A Behavioral Approach," Journal of Economic Literature, American Economic Association, vol. 39(4), pages 1137-1176, December. [Downloadable!] (restricted)
  10. Edward L. Glaeser & David I. Laibson & José A. Scheinkman & Christine L. Soutter, 2000. "Measuring Trust," The Quarterly Journal of Economics, MIT Press, vol. 115(3), pages 811-846, August. [Downloadable!] (restricted)
  11. Rafael La Porta & Florencio Lopez-de-Silane & Andrei Shleifer & Robert W. Vishny, 1996. "Trust in Large Organizations," NBER Working Papers 5864, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  12. Fudenberg, Drew & Maskin, Eric, 1986. "The Folk Theorem in Repeated Games with Discounting or with Incomplete Information," Econometrica, Econometric Society, vol. 54(3), pages 533-54, May. [Downloadable!] (restricted)
  13. Greif, Avner, 1993. "Contract Enforceability and Economic Institutions in Early Trade: the Maghribi Traders' Coalition," American Economic Review, American Economic Association, vol. 83(3), pages 525-48, June. [Downloadable!] (restricted)
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