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Bonding and Bridging Social Capital and Economic Growth

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Author Info
Beugelsdijk, S.
Smulders, J.A. (Tilburg University, Center for Economic Research)
Abstract

In this paper we develop a formal model of economic growth and two types of social capital. Following extant literature, we model social capital as participation in two types of social networks: first, closed networks of family and friends, and, second, open networks that bridge different communities. Higher levels of social capital may crowd out economic growth through a reduction of working time. At the same time, participation in intercommunity networks reduces incentives for rent seeking and cheating, promoting economic growth. We test our hypotheses in a sample of European regions using unique data from the European Value Studies (EVS). Our findings show that it is important to distinguish between the nature of the social interaction.

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Paper provided by Tilburg University, Center for Economic Research in its series Discussion Paper with number 2009-27.

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Date of creation: 2009
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Handle: RePEc:dgr:kubcen:200927

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Find related papers by JEL classification:
O40 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
R11 - Urban, Rural, and Regional Economics - - General Regional Economics - - - Analysis of Growth, Development, and Changes
Z13 - Other Special Topics - - Cultural Economics - - - Social Norms and Social Capital; Social Networks Economic Anthropology

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This page was last updated on 2009-11-25.

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