Social capital, clusters, and interpretive fuzziness: a survey of the key literature (with specific reference to economic development in South East Europe)

This paper aims to give an overview of the extant literature on the various aspects related to social capital (definition, conceptual framework(s), and empirical research), especially with regard to cluster development and place-based learning. The paper also aims to extend the discourse on social capital as it relates to firm learning in transition economies, in particular South East Europe. The paper finds that while there is significant evidence of an apparent link between social capital and the economic and innovative performance of firms and the places in which they are located, the differing definitions and measures used to capture these links leads to an interpretive fuzziness across the literature as a whole. It is further found that the lack of social capital among firms in South East Europe, as manifested by low levels of trust, is potentially a key barrier undermining the development of industrial clusters.