Social capital, economic growth and quality of government: The causal mechanism

What makes a democracy work and which are the causes behind economic growth? One answer is given by Robert D. Putnam in his book about regional reforms in Italy during the 1970s and 1980s, which by now must be considered as a 'modern classic'. Putnam's theory, which is both complicated and sophisticated, is centred on the concept of social capital. The main thrust is that a working democracy depends on a population that is engaged in different social networks and forms of voluntary association. However, two important types of critique have been raised against the theory. One concerns what type of networks and associations actually serves the purpose of making a democracy work. This can be called the 'Hells Angels' problem. Obviously, not all organisations or networks seem to produce the right type of 'bridging' social capital that is at the heart of the theory. There is, as Putnam recognises in his latest book, also a dark side of social capital. It can be argued that societies like Northern Ireland, the Middle East or Bosnia have too much social capital in the forms of networks and organisations that create distrust. The theoretical problem is that there seems to be no way to find a conceptually clear definition that can be used to differentiate between 'the good, the bad and the ugly' organisations in this story. For example, while the Catholic Church is excluded from producing social capital in Putnam's analysis of Italy because of its hierarchical character, churches are included in his study of the USA. Second, several empirical analyses which have tried to find empirical survey-based support at the micro level for Putnam's theory show that, while it is true that individuals who are members of many voluntary associations are more trusting, activity in these organisations and networks does not increase social trust. The correlation between membership in voluntary associations and high social trust seems to be caused by a self-selection mechanism. It is individuals that for other reasons already have high social trust that become active members, but the activity in voluntary associations does not seem to generate social trust. At this vital point, Putnam's theory about the causes of social capital seems to be wrong. If so, this will have important implications both for research and especially for policy purposes. The aim of this article is to provide an alternative explanation for the causes of social capital, an explanation that is grounded more in political instead of sociological variables.