Social Capital, Creative Destruction and Economic Growth
AbstractThis paper provides an analytical framework to capture the economic importance of social capital for growth and innovation. Relational Capital (RC) consists of contacts between economic necessary to acquire inputs and to sell outputs units. These contacts form the individual aspect of social capital that is directly productive. Replacement of old contacts by new ones is part of Schumpeterian creative destruction leading to technological progress. Because informal social networks facilitate the search for contacts, many empirical studies find that social networks supports income generation and innovation. Market institutions enjoy increasing returns to scale in aiding contact formation compared to informal social capital networks. For growth rates in developing countries to increase, a 'fundamental transformation' from informal to formal search institutions is therefore required. But since RC replacement carries a negative externality, creative destruction and technological progress may be punished if it threatens political elite interests. Growth experiences in transition and developing countries are interpreted in this framework.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by School of Economics and Finance, Queensland University of Technology in its series Paul Frijters Discussion Papers with number 2004.
Date of creation: 15 Jun 2004
Date of revision:
Social Capital; Endogenous Growth; Relational Capital; Development; Economic Systems;
Other versions of this item:
- Uwe Dulleck & Dirk J. Bezemer & Paul Frijters, 2004. "Social Capital, Creative Destruction and Economic Growth," Vienna Economics Papers 0406, University of Vienna, Department of Economics.
- Dirk J Bezemer & Uwe Dulleck & Paul Frijters, 2004. "Social Capital, Creative Destruction and Economic Growth," School of Economics and Finance Discussion Papers and Working Papers Series 186a, School of Economics and Finance, Queensland University of Technology.
- O1 - Economic Development, Technological Change, and Growth - - Economic Development
- O41 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
- P51 - Economic Systems - - Comparative Economic Systems - - - Comparative Analysis of Economic Systems
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Larry H. P. Lang & Mara Faccio & Leslie Young, 2001. "Dividends and Expropriation," American Economic Review, American Economic Association, vol. 91(1), pages 54-78, March.
- Samuel Bowles & Herbert Gintis, 2002.
"Social Capital and Community Governance,"
Royal Economic Society, vol. 112(483), pages 419-436, November.
- Dirk Bezemer & Uwe Dulleck & Paul Frijters, 2003.
"Contacts, Social Capital and Market Institutions - A Theory of Development,"
Vienna Economics Papers
0311, University of Vienna, Department of Economics.
- Paul Frijters & Dirk Bezemer & Uwe Dulleck, 2005. "Contacts, Social Capital and Market Institutions - A Theory of Development," Paul Frijters Discussion Papers 2005-1, School of Economics and Finance, Queensland University of Technology.
- Xiaowen Tian, 1999. "Market Orientation and Regional Economic Disparities in China," Post-Communist Economies, Taylor and Francis Journals, vol. 11(2), pages 161-172.
- Paul Mosley & Marina Della Giusta, 1999. "A model of social capital and access to productive resources," Journal of International Development, John Wiley & Sons, Ltd., vol. 11(7), pages 921-934.
- Durlauf,S.N., 2001.
"On the empirics of social capital,"
3, Wisconsin Madison - Social Systems.
- Akerlof, George A, 1970. "The Market for 'Lemons': Quality Uncertainty and the Market Mechanism," The Quarterly Journal of Economics, MIT Press, vol. 84(3), pages 488-500, August.
- Temple, Jonathan, 1998. "Initial Conditions, Social Capital and Growth in Africa," Journal of African Economies, Centre for the Study of African Economies (CSAE), vol. 7(3), pages 309-47, October.
- Edward L. Glaeser & David Laibson & Bruce Sacerdote, 2002. "An Economic Approach to Social Capital," Economic Journal, Royal Economic Society, vol. 112(483), pages 437-458, November.
- Bezemer, Dirk & Dulleck, Uwe & Frijters, Paul, 2005. "Social Capital, Creative Destruction and Economic Development," Research Report 05C09, University of Groningen, Research Institute SOM (Systems, Organisations and Management).
- Thomas Farole & Andrés Rodríguez-Pose & Michael Storper, 2007. "Social capital, rules, and institutions: A cross-country investigation," Working Papers 2007-12, Instituto Madrileño de Estudios Avanzados (IMDEA) Ciencias Sociales.
- Knowles, Stephen, 2006. "Is Social Capital Part of the Institutions Continuum and is it a Deep Determinant of Development?," Working Paper Series RP2006/25, World Institute for Development Economic Research (UNU-WIDER).
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (School of Economics) The email address of this maintainer does not seem to be valid anymore. Please ask School of Economics to update the entry or send us the correct address.
If references are entirely missing, you can add them using this form.