Hostname: page-component-78c5997874-mlc7c Total loading time: 0 Render date: 2024-11-13T05:53:47.226Z Has data issue: false hasContentIssue false
  • English
  • Français

SOCIAL CAPITAL AS AN ENGINE OF GROWTH: MULTISECTORAL MODELING AND IMPLICATIONS

Published online by Cambridge University Press:  08 August 2016

Youyou Baende Bofota ,
Raouf Boucekkine  and
Alain Pholo Bala
Youyou Baende Bofota
Affiliation:
Université de Kinshasa
Raouf Boucekkine
Affiliation:
Université Aix-Marseille
Alain Pholo Bala*
Affiliation:
University of Johannesburg
*
Address correspondence to: Alain Pholo Bala, Department of Economics and Econometrics, University of Johannesburg, APK Campus, D Ring 213, PO Box 524, Auckland Park 2006, Johannesburg, South Africa; e-mail: apholo@uj.ac.za, alainpholo@gmail.com.
Get access Rights & Permissions [Opens in a new window]

Abstract

We propose an endogenous growth model incorporating social capital. Social capital serves only as an input in the production of human capital and it involves a cost in terms of the final good. In contrast to alternative specifications, this model ensures that social capital enhances productivity gains by playing the role of a timing belt that drives the transmission and propagation of all productivity shocks. We find that, depending on the measure of social capital, the elasticity of human capital with respect to social capital varies from 6% to 10%. Finally, we investigate the short-term dynamics and imbalance effect properties of the model, depending on the value of this elasticity. In particular, we show that when the substitutability of social capital for human capital increases, the economy is better equipped to surmount initial imbalances, as individuals may allocate more working time to the final good sector without impeding economic growth.

Keywords

Social CapitalHuman CapitalEconomic GrowthImbalance Effects
Type
Articles
Information
Macroeconomic Dynamics , Volume 20 , Special Issue 8: Technology Aspects in the Process of Development , December 2016 , pp. 2093 - 2122
Copyright
Copyright © Cambridge University Press 2016 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

REFERENCES

Alesina, A. and La Ferrara, E. (2000) The Determinants of Trust. NBER working paper 7621.Google Scholar
Baende Bofota, Y., Boucekkine, R., and Bala, A. Pholo (2012) Social Capital as an Engine of Growth: Multisectoral Modelling and Implications. ERSA working paper 317.Google Scholar
Barro, R. and Lee, J.-W. (2000) International Data on Educational Attainment: Updates and Implications. CID working paper 42.Google Scholar
Barro, R.J. and Sala-i-Martin, X. (1995) Economic Growth. New York: McGraw Hill.Google Scholar
Beugelsdijk, S. and van Schaik, A. (2005) Social capital and growth in European regions: An empirical test. European Journal of Political Economy 21, 301–324.Google Scholar
Boucekkine, R., Martinez, B., and Ruiz-Tamarit, R. (2008) A note on global dynamics and imbalance effects in the Lucas Uzawa model. International Journal of Economic Theory 4, 503–518.CrossRefGoogle Scholar
Boucekkine, R. and Ruiz-Tamarit, R. (2004) Imbalance effects in the Lucas model: An analytical exploration. Berkeley Electronic Journals in Macroeconomics 4, Article 15 (Topics).Google Scholar
Boucekkine, R. and Ruiz-Tamarit, R. (2008) Special functions for the study of economic dynamics: The case of the Lucas–Uzawa model. Journal of Mathematical Economics 44, 33–54.Google Scholar
Chou, Y.K. (2006) Three simple models of social capital and economic growth. Journal of Socio–Economics 35, 889–912.Google Scholar
Delhey, J. and Newton, K. (2005) Predicting cross-national levels of social trust: Global pattern or Nordic exceptionalism? European Sociological Review 21, 311–327.Google Scholar
Földvari, P. and Van Leeuwen, B. (2009) An alternative interpretation of ‘average years of education’ in growth regressions. Applied Economics Letters 16, 945–949.CrossRefGoogle Scholar
Fukuyama, F. (2000) Social Capital and Civil Society. International Monetary Fund working paper WP/00/74.Google Scholar
Galor, O. and Zeira, J. (1993) Income distribution and macroeconomics. Review of Economic Studies 60, 35–52.Google Scholar
Glaeser, E.L., Laibson, D., and Sacerdote, B. (2002), An economic approach to social capital. Economic Journal 112, F437–F458.CrossRefGoogle Scholar
Growiec, K. and Growiec, J. (2012) Social capital, trust, and multiple equilibria in economic performance. Macroeconomic Dynamics 18 (2), 282–315.Google Scholar
Inglehart, R., et al. (2000), World Values Surveys and European Values Surveys, 1981–1984, 1990–1993, and 1995–1997. Ann Arbor, MI: Inter-university Consortium for Political and Social Research.Google Scholar
Knack, S. and Keefer, P. (1997) Does social capital have an economic payoff? A cross-country investigation. Quarterly Journal of Economics 112, 1251–1288.Google Scholar
Knowles, S. (2005) The Future of Social Capital in Development Economics Research. Paper prepared for the WIDER Jubilee Conference (Thinking Ahead: The Future of Development Economics, Helsinki, 17–18 June 2005).Google Scholar
Lucas, R.E. (1988) On the mechanics of economic development. Journal of Monetary Economics 22, 3–42.Google Scholar
Mulligan, C.B. and Sala-i-Martin, X. (1992) Transitional Dynamics in Two-sector Models of Endogenous Growth. NBER working paper 3986.Google Scholar
Paxton, P. (1999) Is social capital declining in the United States? A multiple indicator assessment. American Journal of Sociology 105, 88–127.Google Scholar
Paxton, P. (2002) Social capital and democracy: An interdependent relationship. American Sociological Review 67, 254–277.CrossRefGoogle Scholar
Putnam, R.D. (2000) Bowling Alone: The Collapse and Revival of American Community. New York: Simon and Schuster.Google Scholar
Putnam, R.D., Leonardi, R., and Nanetti, R. (1993) Making Democracy Work: Civil Traditions in Modern Italy. Princeton, NJ: Princeton University Press.Google Scholar
Routledge, B. and Amsberg, J. (2003) Social capital and growth. Journal of Monetary Economics 50, 167–193.Google Scholar
Solow, R.M. (1995) But verify. The New Republic, Sept. 11, pp. 36–39.Google Scholar
Uslaner, E.M. (1999) Democracy and social capital. In Warren, M.E. (ed.), Democracy and Trust, pp. 121–150. Cambridge, UK: Cambridge University Press.Google Scholar
Whiteley, P. (2000) Economic growth and social capital. Political Studies 48, 443–466.Google Scholar
Zak, P.J. and Knack, S. (2001) Trust and growth. Economic Journal 111, 295–321.Google Scholar