Social Capital in Development Planning

Today, civil societies exist in a world context of profound contradictions. People are increasingly interconnected across cyber space so that their personal space extends out to the world¹ and their contacts at a distance can be multiplied in an exponential manner. At the same time, people are increasingly separated across physical space so that they lose close and direct personal relations in favor of media-mediated contacts. Consequently, their perspectives on events, and with it the capacity to act together at the level of their territorial communities, is decreasing. Yet, even today, when people are engaged in common endeavors, in too many countries around the world, civil society is still under siege. From the People’s Republic of China to Turkey, from Burma to Zimbabwe, from Venezuela to Russia, civil society in its organized expressions and efforts is perceived as a threat by the governments, which attempt to control and even retaliate to muzzle its presence and voice. The arrest of leaders of associations, the closure of independent media, the harassment of members protesting in public, and the discrimination against activists in education and employment are some of the measures taken by such governments to stifle the discussion of controversial issues out into the open. In extreme cases, action against the public airing of issues goes as far as extreme measures of internment in labor camps, torture, and imprisonment.

From within the body of scholarly works that the fields of sociology and political science produced in the 1980s, the notion of a new form of capital emerged. This new form did not adhere to the traditional canons that the science of economics had popularized for the forms of capital in which individuals and business invest to achieve the best possible return, such as machinery, land and buildings, or stocks and bonds. Rather, what emerged was a form of capital that came to be known as “social capital” and it had distinct characteristics. In addition to being new, it was also unusual, with traits that were not easily understood because they appeared to even contradict the adjective, “social,” that defined the concept. Indeed and peculiarly, this new form, unlike all other forms of capital, was not produced by individuals or by business, and it was not quantified in terms of economic returns and contributions to the national wealth. Nor was it a tangible asset that could be visually observed as currency bills and buildings or perceived in terms of its financial returns and measured in the changing value of stocks and bonds or bought and sold on the open market. Thus, the question is in order: what is the meaning of the term “social” in the concept of social capital?

Settling the terms of the nature of social capital is essential in order to address the challenge of its constructability, and consequently of the feasibility of what is at the core of this study, that is, the devising and implementation of territorially-specific and social capital-supported development strategies. As we have discussed in the chapter 2, the ample literature on social capital recognizes that it has become an influential concept in the social sciences in terms of the theoretical and policy contributions it makes to the improvement of the economic and political conditions of people and places. Also, a broad consensus has been reached on the fact that, as three authors have written, the concept of social capital has “an immediate intuitive appeal” (Baron, Field, and Schuller, 2000), and there is a degree of convergence of views on the principal elements that now define the concept and inform the characteristics of the interactions that social capital embodies. This is because, by and large, the basic aspects of the scholarly writing on the concept of social capital consistently incorporate the definitional elements of trust, norms of reciprocity, and social networks.

We turn now our attention to a second debate in scholarly and policymaking circles that in the last few decades has paralleled the debate on the nature of social capital. It is the debate about what constitutes the nature of improvements in the quality of life of territorial communities. The incremental recognition of social capital as a constructible community asset that improves institutional performance and produces output and outcome results in diverse policy sectors has contributed to expand this debate on what constitutes community growth and, at the same time, to orientate the focus of the debate on how to achieve it. Indeed, the affirmation of the concept of social capital has been in line with the evolution of the political, economic, and social thinking that in this phase of globalization has been raising critical issues concerning the failed challenge of improving the quality of life of people in differing territorial communities through growth- oriented policies. The criticism has been sustained, particularly in the face of the increasing economic disparities and social inequalities that have become the trend across communities as well as the trait within communities. Consequently, in addition to the analysis of the causes of these negative results, questions have been raised by those who critique the characteristics of the ongoing process of globalization about the types of policies that ought to be adopted to respond to the challenge of decreasing such disparities and inequalities.

There is a point that needs to be dwelt upon and restated. As it has been pointed out in chapter 4, in the same way as the political endorsement of the growth paradigm orientates public policies toward the pursuit of growth as a priority, the pursuit of development occurs only when in a territorial community the political choice is made in its favor. There cannot be development oriented and supportive policies without such a deliberate choice, but only the pretense of endorsing the concept. Indeed, there is a very clear political dimension to development that needs to be recognized because it expresses objectives of social and economic cohesion and inclusion, public support and engagement, and the placing in evidence and conservation of territorial resources over the long term that territorial policies aim to achieve. Development in its comprehensive character, and its related multiple objectives, does not happen casually and certainly not simply as the result of any political endorsement. Rather, what renders the pursuit of development a political project, instead of an abstract aspiration, is a sustained commitment to formulate policies and make policy choices that are germane to the objectives of development in that particular community, leverage community assets, allocate appropriate resources to the policy choices, and master the capacity to carry out the programmatic contents of the policies.

Europe’s rapid industrial decline and the prolonged recession that were produced by the oil embargo crises of 1973 and 1979 followed by the painful process of economic restructuring, brought about the decision in 1985 to accelerate the process of European integration and to expand its policy agenda beyond the original nucleus of essentially trade policies. The adoption of the Single European Act (SEA) in 1986 by the member states meant the beginning of the mandate according to which policy decisions at the European and national levels had to take into consideration “who benefits” and “who does not” as part of the process of creating the Single Market and Single Currency. For the European Community,¹ this meant the adoption of the policy goal of economic and social cohesion that was inscribed in the SEA and then re-affirmed by the preamble to the Maastricht Treaty of 1993.² This wide-ranging territorial policy objective has been pursued primarily through the formulation of medium-term development policies implemented over programming cycles of five to seven years each, that are centered on Europe’s less-developed regions and funded by the significant EU budget resources provided by the Structural Funds-European Regional Development Fund (ERDF) and European Social Fund (ESF) (Nanetti, 2001).

In Spain, the structure of policymaking and the underlining constitutional principles changed radically during the second-half of the 1970s with the transition from the Francoist to the democratic regime. Previously, policymaking was strictly a top-dominated procedure (Valverde, 1973; Bardaviso, 1969) with no allocation of power at the sub-national level. After the transition from authoritarianism to democracy, Spain became a political system where significant policymaking powers were allocated to regions and localities (Balfour and Quirosa, 2007; Balfour, 2005; Gibbons, 1999). In a relatively short period, the Spanish system of government went from being characterized by a strong center and weak periphery to one with a weak center and strong periphery.

This manuscript has long been in the making as our cumulative work over the years has proceeded to look at the development strategies that would be effective in improving the quality of life of people in different types of territorial communities. To this end, over the years, we have compiled a body of evidence. Our conclusions have led us to be critical of the assumptions underwritten by the growth model and skeptical of the promises of prosperity that the model has made over the last decades. However, it has been the general financial and economic crisis, which engulfed the world starting in 2008, that exposed the fragility and the lack of validity of the claims made by the growth model and that ultimately sanctioned the failure of the model even for the future of the more prosperous territorial communities in the developed countries. Indeed, the crisis has rendered the perspective of social capital informed development strategies more compelling in its long-term prospects of success in contrast to the prevailing perspective of growth seeking strategies.