Is social capital underproduced?

Abstract

Is social capital likely to be underproduced without state action? Where previous analysts have typically argued that social capital is a public good and, therefore, needs government action to be produced at an optimal level, we argue that social capital is not a public good because though often non-rivalrous, it is almost always excludable. As such, social capital is more appropriately conceived of as a club good. Further, we argue that governments are not likely to be in a position to improve a society’s social capital due to epistemic limits and the complexity of social capital. Finally, we argue that rather than a state solution, solutions to social capital-related problems are best solved through a bottom-up process. As we demonstrate throughout, this has implications for how we understand community resilience in the wake of disasters. The key role that social capital plays in facilitating community rebound after disasters has been widely acknowledged. If social capital is a public good, then policymakers could be justified in focusing on cultivating social capital as a strategy for promoting community resilience. If social capital is a club good and there are limits to top-down strategies for creating social capital, however, then social capital creation is not an available policy lever.