Chapter-5: Social capital and collective action,
theories and practices
Introduction
❑Social capital and collective action are key
concepts in understanding how communities
cooperate, solve shared problems, and promote
development.
❑These ideas bridge sociology, political science,
and economics.
❑Central questions:
✓ Why do people cooperate for common goals?
✓ How do trust and networks influence social
outcomes?
Types of Capital
Type Definition / Key Idea
Money or liquid assets used for investment
Financial Capital
and profit.
Tangible assets like machinery, buildings,
Physical Capital
infrastructure.
Natural resources such as land, water,
Natural Capital
minerals, and ecosystems.
Skills, knowledge, and health of individuals
Human Capital
enhancing productivity.
Public trust, norms, and networks within a
Social Capital
community that facilitate cooperation.
What is social capital?
❑Social capital refers to the networks, norms,
relationships, and trust that enable individuals to
act collectively and achieve shared objectives.
✓Social capital as resources linked to a network of
relationships (Pierre Bourdieu ,1986)
✓Social capital as a public good that facilitates
coordinated actions (James Coleman,1988).
✓Emphasized trust, norms, and networks in civic
engagement (Robert Putnam,1993, 2000).
What is social capital?
❑ Social capital refers to the benefits derived from social
relationships and networks.
❑ “Relationships matter” being connected and working
together is valuable.
1. Social Context + Productive Benefits
✓ “Social” → networks, trust, norms, and relationships.“
✓ Capital” → these social resources have productive and
economic value.
2. Solidarity and Goodwill
✓ Represents the store of trust, cooperation, and mutual
support among individuals and groups.
3. Metaphors to Understand Social Capital
✓ “Favor bank”: People perform helpful acts expecting
future reciprocity.
✓ Helpfulness behaviors: Acts motivated by gratitude,
respect, friendship, or shared norms.
Advantages of Social Capital
1. Facilitates Information Flow
✓ Social connections enhance the spread of ideas, knowledge, and
opportunities.
✓ Example: Job opportunities often arise through personal
networks rather than formal channels.
✓ Captured by the saying: “It’s not what you know, it’s who you
know.”
2. Enhances Personal Well-Being
❖ Access to social capital is linked to:
✓ Higher happiness levels
✓ Better physical and mental health
✓ Increased trust within communities
3. Strengthens Organizations
❖ Within businesses or groups, high social capital leads to:
✓ Trust and mutual respect among members
✓ Collaboration and teamwork
✓ Higher productivity and profitability
5.1.1 Classification of Social Capital
❑There are several dichotomies (two-way
classifications) used to describe different types
of social capital.
1. Network Perspective
❖From a network perspective, social capital can
be classified as:
[Link] Social Capital
[Link] Social Capital
[Link] Social Capital (suggested as a third
type)
1. Bonding Social Capital
❖ Refers to ties between individuals with a high degree of network
closure — that is, strong, dense connections among members of the
same group.
Characteristics:
✓ Involves horizontal ties — connections among individuals within the
same social group (rather than vertical ties between groups).
✓ Common in local communities where many people know each other
well (high network closure).
✓ Associated with strong norms, shared values (mores), and high
levels of trust.
✓ These features can produce positive effects (solidarity, mutual
support) but also negative effects (social exclusion or resistance to
outsiders).
Implications:
✓ Members often have similar network assets — the same information,
resources, and opportunities.
✓ While this strengthens group cohesion and identity, it may limit
access to diverse or useful external resources in some situations.
Summary of Bonding Social Capital
Feature Description
Type of tie Horizontal (within-group)
Network structure High closure, dense connections
Strengths Trust, solidarity, mutual aid
Insularity, social exclusion, limited
Weaknesses
diversity
Families, close-knit communities,
Common contexts
ethnic or cultural groups
2. Bridging social capital
❑Refers to ties between individuals that cross
social divides or connect different social
groups.
❑These links bridge gaps between otherwise
disconnected networks.
❑Involves actors positioned at structural holes
points where they can access and exchange the
social network resources of different groups.
❑Often described as vertical ties, operating
through formal or hierarchical structures (e.g.,
organizations, institutions).
Cont…
Characteristics:
❖ Connects diverse groups, unlike bonding capital which focuses on
similar individuals.
❖ May not involve many shared norms or values, but relies on
reciprocity and “thin trust” (generalized trust among strangers or
acquaintances).
❖ Provides access to new information, resources, and opportunities
outside one’s usual social circles.
❖ Enhances social mobility and innovation by linking different
networks.
Implications:
✓ Benefits individuals and groups by extending access to broader
resources and opportunities.
✓ Encourages integration across communities and supports collective
problem-solving.
✓ However, trust and cohesion may be weaker compared to bonding
social capital.
Summary Bridging social capital
Feature Description
Type of tie Vertical or cross-group
Network Bridges structural holes between
structure groups
Trust level Thin trust (reciprocity-based)
Access to new resources, diversity,
Strengths
innovation
Less shared norms, weaker
Weaknesses
emotional bonds
Inter-group collaborations,
Common contexts
institutions, workplaces
3. Linking social capital
❖ Refers to the norms of respect and networks of
trusting relationships between individuals or groups
who interact across formal, institutionalized power or
authority gradients in society.
❖ In other words, it connects people or groups at
different social, economic, or institutional levels.
❖ Involves vertical connections between those in
unequal positions of power, influence, or status (e.g.,
citizens and government officials, NGOs and
communities).
❖ Facilitates access to resources, support, or influence
from formal institutions or higher authorities.
Cont…
Characteristics:
❖ Built on respect, trust, and mutual recognition between
individuals or groups of unequal standing.
❖ Similar to bridging social capital, but with an emphasis
on power differentials.
❖ Encourages social inclusion, participation in governance,
and effective institutional cooperation.
Implications:
✓ Strengthens the connection between communities and
institutions.
✓ Promotes empowerment, enabling less powerful groups
to access resources and opportunities through formal
channels.
✓ However, if misused, it can reinforce dependency or
unequal power relations.
Summary of Linking social capital
Feature Description
Vertical (across power or authority
Type of tie
gradients)
Links individuals/groups at different
Network structure
social levels
Trust basis Respect and institutional trust
Access to authority, empowerment,
Strengths
inclusion
Weaknesses Potential dependence or exploitation
Bridging social capital (but includes
Similar to
power hierarchy)
Relationships between communities and
Examples
governments, NGOs, or businesses
5.1.1. Social structure Vs Cognitive perspective
❑Although social capital can be classified in
many ways, one key distinction is between
structural, cognitive, and relational forms.
❑These forms are interconnected and mutually
reinforcing — structural arrangements shape
shared values (cognitive), and both depend on
the quality of relationships (relational).
Structural Social Capital
❑ Refers to the elements of social structure that create
opportunities for productive social interaction.
❑ Represents the visible, external aspects of social
organization.
Key Features:
✓ Includes established roles, networks, rules,
procedures, and precedents.
✓ Provides structure and stability to social transactions.
✓ Built from the historical and cultural foundations of
a society’s institutions.
✓ Focuses on “what people do” — the patterns of
connections and interactions.
Structural Dimension of Social Capital
❖The structural dimension of social capital
refers to the properties of the social system and
the forms of social organization that make up
society.
❖It represents the impersonal configuration of
linkages between individuals or units within
that system.
Cont…
Key Characteristics:
1. Social Organization Framework:
1. Encompasses the roles, rules, precedents, and procedures
that define how people interact within a society.
2. These structures provide a framework for coordination
and guide behavior.
2. Facilitation of Collective Action:
1. By making people’s behavior more predictable, it
encourages cooperation and collective action.
2. Stability in rules and roles allows individuals to trust and
rely on expected outcomes.
3. A Construct of Society:
1. The structural dimension exists as part of the social
organization — it is created and maintained through social
interactions and shared understanding.
Cognitive dimension of social capital
❖ The cognitive dimension of social capital refers to the social setting
or culture that dictates how individuals should act in various
situations.
❖ It represents the shared representations, interpretations, and systems
of meaning that guide behavior within a social system.
Key Characteristics:
[Link] and Normative Context:
✓ Defines the “proper” ways of acting within a community or society.
✓ Reflects the values, attitudes, norms, and beliefs that influence how
people think, feel, and behave toward others.
[Link] for Collective Action:
✓ Predisposes people toward mutually beneficial cooperation.
✓ Shared values and norms make cooperative behavior rational,
respectable, and expected.
3. Shared Understanding and Meaning:
✓ Involves common language, shared purpose, and sense of belonging.
✓ Provides a symbolic and emotional bond that connects individuals
and encourages trust.
Embeddedness versus autonomy
❖This distinction explores how societies balance
collective values (embeddedness) and
individual freedom (autonomy).
❖It reflects differences in how culture influences
behavior, decision-making, and social
relationships.
Embeddedness
❑ Embeddedness refers to a cultural orientation that values tradition,
security, conformity, and social harmony.
❑ Individuals are seen as part of a larger collective, and their actions
are guided by shared norms and expectations.
Key Characteristics:
✓ Emphasizes social cohesion and stability.
✓ Values agreement, loyalty, and respect for tradition.
✓ Individuals tend to consider others and follow common rules when
making decisions.
Advantages:
✓ Promotes social trust, predictability, and collective responsibility.
✓ Strengthens group identity and mutual support.
Limitations:
✓ May restrict individuality and discourage innovation.
✓ Can lead to conformity and resistance to change.
Autonomy
❖ Autonomy represents a cultural value that prioritizes individual
freedom, independence, and self-direction.
❖ People are encouraged to make choices based on personal judgment
rather than collective expectations.
Key Characteristics:
✓ Focuses on personal control over one’s actions and decisions.
✓ Values creativity, diversity, and freedom of expression.
✓ Contrasts with the “policed control” found in embeddedness-oriented
societies.
✓ Individuals act more according to internal values than external
pressures.
Advantages:
✓ Encourages innovation, self-reliance, and personal growth.
✓ Allows for adaptability and flexibility in decision-making.
Limitations:
✓ May weaken social cohesion and shared responsibility.
✓ Can lead to individualism and social fragmentation if unbalanced.
5.2. Theories of collective action
➢Theories of collective action study how groups
of individuals with common interests can act
together to achieve shared goals.
➢The central problem arises from the tension
between individual self-interest and the
collective good.
➢Individuals often face a choice between:
✓Short-term self-regarding actions, and
✓Long-term cooperative actions that benefit the
group if enough members participate.
The Collective-Action Problem
❑Occurs when individual incentives conflict with
collective benefits.
❑Each person may prefer to free ride on others’
efforts rather than contribute.
❑As a result, mutually beneficial outcomes may
fail to materialize.
Example:
❖The Prisoner’s Dilemma captures this situation:
✓No matter what others do, an individual gains more in
the short term by not cooperating.
✓Yet if all act selfishly, everyone is worse off than if all
had cooperated.
First-Generation Theories of Collective Action
Key Thinkers:
❖Mancur Olson (1965) — The Logic of Collective
Action
❖Garrett Hardin (1968) — The Tragedy of the
Commons
Core Assumptions:
✓ Individuals are atomized, selfish, and fully
rational.
✓ They act independently and seek to maximize
their own benefit.
✓ Without intervention, individuals cannot achieve
joint benefits on their own.
Predicted Outcomes:
Cont…
✓ Groups fail to cooperate voluntarily.
✓ Collective resources are overused or underprovided.
✓ Proposed Solutions:
1. Regulation by external authority (e.g., government
enforcement)
2. Selective incentives — rewards for participation or penalties for
defection
3. Privatization — assigning property rights to align individual
and collective interests
Limitations:
✓ These theories describe only the limiting case of collective-
action situations.
✓ They ignore real-world social contexts — trust,
communication, reputation, and institutions.
✓ They assume homogeneous, rational actors and overlook social
relationships.
Second-Generation Theories of Collective Action
Emergence:
❑ Developed in response to empirical and experimental
findings showing that individuals often do cooperate,
even without external enforcement.
Key Influences:
➢ Behavioral economics, experimental game theory,
and evolutionary models (e.g., Blomquist 1992;
Bolton & Ockenfels 2000; NRC 2002).
❑ Cooperation can emerge endogenously through:
✓ Social capital (trust, networks, reciprocity)
✓ Communication and reputation
✓ Shared norms and cultural expectations
✓ Institutions that facilitate coordination
Cont…
Implications:
❖People do not live in an atomized world; they
interact within social networks that shape
choices.
❖Trustworthiness, norms, and institutions are
key in sustaining cooperation.
❖Second-generation models show that
collective action is possible when social and
institutional mechanisms encourage
cooperation.
Comparison: First vs Second Generation
Theories
Aspect First Generation Second Generation
Atomized, selfish, fully Boundedly rational,
View of individuals
rational socially embedded
External authority or Internal norms, trust,
Source of cooperation
incentives and social capital
Regulation, privatization, Communication,
Key mechanisms
selective incentives reciprocity, institutions
Homogeneous actors, no Heterogeneous actors,
Assumptions
trust capable of trust
Cooperation achievable
Failure of voluntary
Outcomes through social
cooperation
mechanisms