A Theoretical Approach Of The Concept Of Social Capital In Supporting Economic Performance

Any activity requires the presence of labor resources. If centuries ago the concept was that their presence was enough, now it takes a lot more. Moreover, since Aristotle the issue was taking into consideration all aspects of the community life that can lead to a \"better life\". In the current conditions we may consider resources in the broader context of the human factor and of the relations established within a society. Thus social capital was conceptualized. As opportunities of economic growth - based purely on the quantitative aspects of the determinants -were limited, the need occurred to reconsider the qualitative and structural components. Social capital considers a number of the integrative components of social life. These refer to the relations established at family level up to the level of societal institutions. It is necessary that these relationships be well established, and for the proper performance it is necessary that aspects of education and health should be properly valued and assessed. This helps setting up strong institutions. Developed countries have the ability to create a proper environment for the manifestations of social capital; in these countries one can observe the growing importance of formal and more impersonal relations. But this just reinforces the occurrence and development of economic activities based on efficiency criteria leading to the countriesâ€(tm) economic development. The interpretations of economic development issues have undergone changes in recent decades. If previously it was considered that the essential difference between rich and poor countries is reflected in the amount of physical capital per person, later on the concept of capital has been expanded to include as well human capital, the lack of which was considered a serious obstacle to development, particularly in the case of poor countries. And given the fact that the transactions within an economic system take place in an institutional and cultural framework that defines the majority of the transactionâ€(tm)s features, the present paper analyzes the concept of social capital - which alongside other forms of capital significantly influences economic progress - in order to emphasize the link between the functionality of institutions, culture and the level of economic development.