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Social Capital, The Terms Of Trade, And The Distribution Of Income

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  • Robison, Lindon J.
  • Myers, Robert J.
  • Siles, Marcelo E.

Abstract

Social capital, a person or group's sympathy or sense of obligation for another person or group, assumes relationships can alter the terms of trade and the likelihood of trades between individuals. Other important economic consequences of social capital result from its ability to internalize externalities. This paper introduces social capital into the neoclassical model to derive forecasts of how relationships will alter the minimum-sell prices of farmland and the likelihood of trades between persons with different relationships. Also deduced in this paper is the effect of social capital on the level and dispersion of benefits from trade. Empirical evidence from a 1,500 farmland owner-operator survey is analyzed and provides support for the social capital paradigm.

Suggested Citation

  • Robison, Lindon J. & Myers, Robert J. & Siles, Marcelo E., 1999. "Social Capital, The Terms Of Trade, And The Distribution Of Income," Staff Paper Series 11546, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    • Handle: RePEc:ags:midasp:11546
    DOI: 10.22004/ag.econ.11546
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    References listed on IDEAS

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    1. Robison, Lindon J., 1996. "In Search Of Social Capital In Economics," Staff Paper Series 11589, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    2. Lindon Robison & A. Allan Schmid & Marcelo Siles, 2002. "Is Social Capital Really Capital?," Review of Social Economy, Taylor & Francis Journals, vol. 60(1), pages 1-21.
    3. Thorstein Veblen, 1908. "On the Nature of Capital: Investment, Intangible Assets, and the Pecuniary Magnate," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 23(1), pages 104-136.
    4. Thorstein Veblen, 1908. "On the Nature of Capital," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 22(4), pages 517-542.
    5. Robison, Lindon J. & Schmid, A. Allan, 1994. "Can Agriculture Prosper Without Increased Social Capital?," Choices: The Magazine of Food, Farm, and Resource Issues, Agricultural and Applied Economics Association, vol. 9(4), pages 1-3.
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    Cited by:

    1. Philip Kostov & Myles Patton & Seamus McErlean, 2008. "Nonparametric analysis of the influence of buyers' characteristics and personal relationships on agricultural land prices," Agribusiness, John Wiley & Sons, Ltd., vol. 24(2), pages 161-176.
    2. Chang, Tsaiyu, 2021. "Would Religious Social Capital Affect Farmland Transactions? A Spatial Autoregressive Analysis in Taiwan," 2021 Conference, August 17-31, 2021, Virtual 314975, International Association of Agricultural Economists.
    3. Sandra Viviana Polanía Reyes, 2005. "Capital Social E Ingreso De Los Hogares Del Sector Urbano En Colombia," Documentos CEDE 2099, Universidad de los Andes, Facultad de Economía, CEDE.
    4. Tsaiyu Chang, 2021. "Does religious social capital affect farmland transactions? A spatial autoregressive analysis in Taiwan," Letters in Spatial and Resource Sciences, Springer, vol. 14(3), pages 223-245, December.

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