Effects Of Social Capital On Economic Inequality In Gombe State: Evidence From Public Workfare Dataset

The study examines the distributive consequences of social capital on economic inequality in a weak institutional context. Using cross-sectional microdata from 14,659 households drawn from the 2021Gombe State Public Workfare Programme in Northern Nigeria, and using inequality decomposition techniques (Generalised Entropy and Atkinson indices) as well as an ordered logistic regression method. The sample consists of all eligible poor and vulnerable households captured in the programme database, with observations filtered for completeness of household asset ownership and social network information. Contrary to traditional assumptions that social capital enhances equity and collective welfare, the findings indicate a statistically significant and positive relationship between social capital and economic inequality. The evidence suggests that in an environment constrained by weak governance, access to social networks is unequally distributed and subject to elite capture, reinforcing structural disparities rather than narrowing them. Gender-based inequality is responsible for more than 85 per cent of total inequality, suggesting excludability dynamics even among poor households. The findings contribute to development theory by demonstrating that the effects of social capital are conditional on institutional inclusiveness, offering a framework for understanding why informal clubs and associations may widen rather than narrow inequality in low-income settings. Especially in a context characterised by limited institutional inclusiveness and weak formal governance structures. The policy implications of the study are that thereis a need for social capital formation, institutional reforms that prevent elite capture, and gender-responsive community programs to transform social networks into instruments of collective prosperity.