Social capital has a long intellectual history in the social sciences. In this paper, social capital refers to the institutions, relationships, and norms that shape the quality and quantity of a society's social interactions. Social capital is not just the sum of the institutions underpinning a society; rather, it is the glue that holds them together.
Lyda Hanifan, a West Virginia school reformer (1916), was the first to use the term social capital. Jane Jacobs reinvented it during the late 1960s, Glenn Loury elaborated upon it during the late 1970s, and James Coleman used it to examine Chicago schools in the 1980s. Coleman and Loury prefer to view social capital as a bottom-up phenomenon that is not directly amenable to public policy intervention. French sociologist Pierre Bourdieu developed a contemporary approach, though Anglo-American scholars remained unaware of it until the late 1980s.
The major momentum for scholarship on social capital, however, came with Robert Putnam's seminal work on democratic governance in contemporary Italy (1993) and his subsequent challenging thesis that late twentieth-century Americans were bowling alone, by which he meant that they were becoming increasingly disengaged from active participation in public life, a trend with disconcerting implications for active democratic participation. He developed his thesis with his bowling alone article (1995), which led to scores of active research projects around the world on social capital.
Organizational-level social capital cannot be measured merely as an aggregation of individual networks, for attention has to be given to inter-organizational networks as well as to the study of this network's nature. Community-level social capital resides in groups and in the networks among these organizations/groups. Strong society-/community-level social capital creates a civic infrastructure that supports formal and informal processes of decision-making and public involvement. The idea of social capital has coalesced around several fields: families and youth behavior problems, schooling and education, community life, work and organizations, democratic governance, collective action problems, and economic development. Building and maintaining networks is not a natural given; rather, it requires investments that yield a return.
Since Putnam's identification of the social capital in regional governance and economic development in Italy (1993) and his latest suggestion in the U.S. (1995, 2000), a virtual industry of interest and action has been created around the implications of his findings for the development of low-income communities. Putnam attributes a significant portion of differences in government effectiveness, economic health, and community well-being to the presence (versus absence) of social capital. Stated simply, he considers the main elements of social capital to be trust and cooperation. Social capital consists of networks and norms that enable participants to act together effectively to pursue shared objectives. There is a strong collective aspect of social capital, as the social and economic system as a whole functions better because of the ties among the actors that make it up.
Government partnership includes partnering with for-profit corporations and nonprofit organizations, such as social service agencies, cultural groups, neighborhood organizations, hospitals, and health organizations. Alexis de Tocqueville, while touring America in 1831-32, noticed how different Americans were from Europeans in their enthusiasm for banding together to support a good cause. We see the result of this cultural characteristic today, for America did not follow the model of a European welfare state. American policymakers used taxes and direct subsidies to deliver services. America has created a welfare state through nonprofit organizations, the vast majority created since 1959.
State-nonprofit collaborations involve nonprofit organizations addressing local, state, and national problems through negotiated efforts or partnerships with business, government, colleges and universities, or other public or social institutions. Public organizations should look for opportunities to work with other nonprofit organizations-even with their competitors-in solving growing public problems in a timely and efficient manner. These efforts encompass several categories: governments often seek to execute their efforts via structures of interagency collaboration; the role of not-for-profit organizations is large and growing; and the frequency and variety of links with for-profit firms is impressive and government contracting remains a growth industry.
Generating social capital
Putnam (2000) states that civic engagement and social connectedness are practical preconditions for better schools, safer streets, faster economic growth, more effective government, and even healthier and longer lives. Without an adequate supply of social capital, meaning civic engagement, healthy community institutions, norms of mutual reciprocity, and trust, social institutions falter.
The value creation process of public and nonprofit partnerships generates incremental social capital to the partners, members, and to society as a whole. Benefits generated by an effective partnership often exceed the partnership's purpose and enable the social mission to be accomplished more effectively. Public-nonprofit partnerships focused on social problems can also serve as motivating informative models for others to follow. As a partnership evolves, the value of the benefits can erode. Skills acquired by one partner from another, for example, may no longer be a transferable benefit. Relationships are dynamic and subject to alteration due to changes in the external environment. Also, partners' need and priorities can change.
Public-nonprofit partnerships can be seen as vehicles for generating social capital by creating and strengthen organizations and collaborations within the community. For example, they enable community members to participate in those aspects of community life that concern them by setting priorities, developing programs, and participating in them. Creative action by public organizations can foster social capital, and linking mobilized nonprofit organizations and citizens can enhance governmental efficacy.
The role of nonprofits
According to Putnam: By almost every measure, Americans' direct engagement in politics and government has fallen steadily and sharply over the last generation, despite the fact that average levels of education-the best individual-level predictor of political participation-have risen sharply throughout this period. At the same time, membership in and the number of nonprofits has increased (although there has been increased competition among nonprofits for this membership). This would seem to contradict de Tocqueville's thesis. But, as Putnam points out, contributing to a nonprofit organization or joining an association and reading its newsletter does not necessarily translate into greater civic participation.
Nonprofit organizations play a vital role in creating and sustaining social capital, namely, those bonds of trust and reciprocity that seem to be pivotal for a democratic society and market economy to function effectively. But one would expect American individualism to make it difficult to sustain such organizations. De Tocqueville understood this point well when he wrote in Democracy in America in 1835: Feelings and opinions are recruited, the heart is enlarged, and the human mind is developed, only by the reciprocal influence of men upon one another these influences are almost null in democratic countries; they must therefore be artificially created and this can only be accomplished by associations.
Thus the perpetuation of a vital nonprofit sector is essential to developing and sustaining a sense of community, which is required to uphold contracts and enable both a market system and a democratic policy to operate.
Investing in social capital by attempting to increase civic participation therefore will strengthen democracy. Since nonprofits reach so many people, and because some nonprofits are powerful secondary associations, we are targeting nonprofits. They are an important source, if not the main source, for discussing critical public policy issues. Thus, nonprofits may play a unique intermediary role in helping to stimulate civic participation through a series of actions aimed at public education, research, advocacy, mobilizing, and so on. Public-nonprofit partnerships have emerged as an important institutional arrangement for addressing important societal concerns through the collaborative efforts and, as a result, the combined strengths of organizations from the public, private, and non-profit sectors.
Education is a very important field in which states can have a direct influence upon the generation of social capital. Educational institutions do not simply contribute human capital; they also contribute to social capital in the form of social rules and norms. States can foster the formation and creation of social capital directly or indirectly by providing public goods and public safety. They also can hinder its formation and creation by undertaking activities that are better left to nonprofits. If the state organizes everything, people will become dependent and lose their interest in and ability to work together. If states cannot contribute directly to the creation of social capital, they should create an environment in which nonprofits can do so.
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