Wednesday, 28 March 2012

Eight Criticisms of Social Capital

Criticism 8: the concept is difficult to operationalise, attempts to do so have been inconsistent and obscure the way more specific concepts have been applied.

The concept of social capital remains somewhat indistinct, but other imprecise concepts have been useful to the social sciences, often with their importance emerging though the process in which they become operationally defined, as with many of the core concepts of critical geography. To be useful to researchers, the concept of social capital has to be comparable from case to case, which leads to the crucial question of how the concept of social capital becomes operationalised in research. This problem can be exemplified by examining the way in which social capital research has been applied to the innovation process.

The process of innovation has been analysed in terms of technology networks, in particular the systems of innovation literature (e.g. Lunvall 1992) and social network (e.g. Obstfeld 2005). In relation to such networks, a sizable body of research suggests that social capital plays a key function in the innovation process, identifying its function in features such as learning and communicating, and developing relations based on trust (for example Maskall 2000; Landry, Amara, and Lamari 2002; Molina et. al. 2008). Peter Maskell, for example, focuses on the features that are built though sharing a common goal or connected by a mutual fate, stating:
Social capital enables firms to improve their innovation capability and conduct business transactions without much fuss and has, therefore, substantial implications for economic performance (Maskell 2000: 111)
Such a statement is bold and provocative and yet, inconveniently, Maskell admits that “we still know very little about the process by which social capital is produced and accumulated” (Maskell 2000: 114). Examining this gap between the potential that the concept might afford and the caution needed when confronted with the empirical evidence, is frustrating, and often found within the same page of an academic article, either explicitly, or more frequently implicitly. To use another example, Hans Westlund and Elin Nilsson (2005) argue that there are indications showing connections between an enterprise’s investment in social capital and its growth, though when the research is examined in more detail, it is found to include advertising sponsorship and internal entertainment among the main types of investment in social capital.

Attempts to operationalise social capital in explaining innovation illustrate that once unified, the concept explains very little even when identified as a contributory factor. For example, using data from a regional survey, Landry, Amara, and Lamari (2002) examine the relationship between innovation and six forms of social capital, five structural (business network assets, information network assets, research network assets, participation assets, and relational assets) and one form of cognitive social capital (reciprocal trust). Their conclusions, based on statistical regression, seem to suggest that marginal increases in social capital “contribute more than any other explanatory variable to increase the likelihood of innovation of firms” (Landry, Amara, and Lamari 2002: 695) a conclusion far weaker than the hype that surrounds the concept would suggest. Indeed the findings are robust and based on excellent research practices but do not explain the processes that social capital was supposed to explain until it is separated into a number of component parts. Other attempts to operationalise the concept (Tsai and Ghoshal 1998; Yli-Renko, Autio and Tontti 2002; Molina et. al. 2008) provide some potentially interesting ideas, but these ideas seem more profitably explored as individual features, for example in examining how different cultures of trust in Spain and Italy contribute to different modes of innovation (Molina et. al. 2008: 96-101). This is at odds with the basic assumption concerning social capital as a concept: “social capital is more than the sum of the various kinds of relationships” (Adler and Kwom 2002: 36) and that rather than reveal features of reality, actually conceal a range of individual practices by attempting to reduce them to a single homogenous category. Problems in operationalising the concept in its unity as an explanatory concept, is a consequence of the cumulative limitations as identified in the other seven criticisms.

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