Nowadays, many social scientists agree that social capital is present and positively contributes to economic growth in the light of many studies. In other words, social capital is important to the efficient functioning of modern economies. It constitutes the cultural component of modern societies, which in other respects have been organized since the enlightenment on the basis of formal institutions, the rule of law, and rationality. Building social capital has typically been seen as a task for second generation economic reform; but unlike economic policies or even economic institutions, social capital cannot be so easily created or shaped by public policy. This project will define social capital, explore its economic and …show more content…
How Do We Measure Social Capital? One of the major weaknesses of the social capital concept is the absence of consensus on how to measure it. At least two broad approaches have been taken: the first, to conduct a census of groups and group memberships in a given society, and the second, to use survey data on levels of trust and civic engagement. At the end of this section, I will suggest a third metric that may point to a measure of social capital within private firms. Robert Putnam has tried to measure social capital by counting groups in civil society, using a number n to track size of memberships in sports clubs, bowling leagues, literary societies, political clubs, and the like as they vary over time and across different geographical regions. There are, in fact, a large number of n's in any given society, n1..t. Hence the first measure for the total social capital (SC) in a society is the sum of the membership of all groups,
Â Â Â (1)Â Â Â SC = [pic]n1..t.
Both n and t are important measures of civil society. A small value