Building and destroying social capital: The case of cooperative movements in Denmark and Poland

Social capital, measured as the level of trust among people, may be regarded as a new production factor alongside the traditional ones of human and physical capital. With appropriate levels of social capital, monitoring and transaction costs can be saved and thus economic growth stimulated. Via linking social capital to rural development and comparing the cases of agricultural cooperative movements in Denmark and Poland, this paper identifies possible roots of building social capital and suggests that social capital was built through a lengthy process in both countries during the 19th century. However, the comparison of the present level of social capital indicates that the level of social capital is significantly higher in Denmark than in Poland. The paper concludes that the reason for this difference is the fact that the original accumulation of social capital in Poland was destroyed by the communist regime.