[Apologies for the cross-posting.] The Australian government's Productivity Commission [sic] has just released a report on social capital. Considering the enthusiasm for the concept by mainstream politicians --- right and left --- the report is surprisingly critical, although it fits with the generally neo-liberal perspective of the Commission. (There is, of course, no mention of Marx's critique of social capital.)
e.g. "Adverse effects on outsiders" "While social capital within a group will generally provide benefits to the members of that group, its translation into benefits for the broader community depends in part on the group's goals. In some cases, the achievement of group objectives may come at the expense of community wellbeing. As Ostrom (2000b, 176-177) points out: Gangs and the Mafia use social capital as the foundation for their organisational structure. Cartels also develop social capital in their effort to keep control over an industry so as to reap more profits than would otherwise be the case. An authoritarian system of government based on military command and use of instruments of force destroy other sorts of social capital while building its own. As well as intentionally deleterious behaviour, group behaviour can also have the effect of excluding outsiders from positions and opportunities. Portes (1998) lists several examples including the traditional monopoly of Jewish merchants over the New York diamond trade, and the dominance of Cubans over several sectors of the Miami economy. In each instance, 'the same social relations that.enhance the ease and efficiency of economic exchanges among community members [also] implicitly restrict outsiders' (Waldinger 1995, 557). Further, Adler and Kwon (2000) argue that high levels of social capital within a particular group can undermine broader social capital within a community. Citing Foley and Edwards (1996), they note that social capital's solidarity effects can split the broader aggregate into 'warring factions or degenerate into congeries of rent seeking "special interests" '. Similarly, Woolcock (1998) cites research that strong, long-standing civic groups may stifle macroeconomic growth by, among other things, securing a disproportionate share of national resources. Adverse effects on insiders Community or group participation often creates demands for conformity, which restrict individual freedoms. Portes (1998) observes that all inhabitants of some small villages and towns know each other and 'the level of social control in such 22 SOCIAL CAPITAL settings is strong and also restrictive of personal freedoms, which is the reason why the young and the more independent minded have always left.' Social norms and obligations within particular groups or communities can also stifle individual incentives to prosper, in a number of ways. One is by requiring successful group members to share significant portions of any resources or opportunities they acquire. A study of commercial enterprises in Bali has found that many successful entrepreneurs were: constantly assaulted by job and loan seeking kinsmen. These claims were buttressed by strong norms enjoining mutual assistance within the extended family and among community members in general (Portes 1998, 16). Similarly, Woolcock (1998) suggests that strong, long-standing civic groups may inhibit individual economic advancement by placing heavy personal obligations on members that prevent them from participating in broader social networks. Another way in which individual advancement is curtailed is through downward-levelling norms: there are situations in which group solidarity is cemented by a common experience of adversity and opposition to mainstream society. In these instances, individual success stories undermine group cohesion because the latter is precisely grounded on the alleged impossibility of such occurrences. The result is downward levelling norms that operate to keep members from a downtrodden group in place and force the more ambitious to escape from it. (Portes 1998, 17) Portes presents as an example the community of Puerto Rican 'crack dealers' in the Bronx, where individuals who wish to better themselves by joining mainstream society are often singled out and attacked by other members of the group in order to prevent them from doing so. More generally, in some communities, there may be strong internal agreement with strong norms and sanctions, and such communities may well exhibit high internal cohesiveness. However, many people would argue that some such norms and sanctions are detrimental to many of the insiders. Examples include sanctions against the education of girls in some developing countries, and the severe ostracism of members who disobey the norms of the Amish communities in the United States. Finally, as noted earlier (section 2.4), overly strong in-group solidarity may reduce the inflow and uptake of new ideas into a group, leading to inertia and parochialism, and thus limiting the economic advance of the group members as a whole." http://www.pc.gov.au/research/commres/socialcapital/socialcapital.pdf
