This paper attempts to delineate the mechanisms that link social capital and economic development. I show that social capital can produce two kinds of trust, both of which can reduce transaction costs. It is important to keep these two sources of trust apart, since development policies utilizing social capital have different impacts, depending on the basis of trust.
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Length: Date of creation: 2000 Date of revision: Handle: RePEc:fth:bereco:216
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Find related papers by JEL classification: O2 - Economic Development, Technological Change, and Growth - - Development Planning and Policy O1 - Economic Development, Technological Change, and Growth - - Economic Development
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