Social Capital & European Society

Social capital and its role in society have been defined by many different scholars and writers in different ways. Lyda Hanifan was one of the first to use the term in 1916. Her definition of social capital was, “Those tangible assets [that] count for most in the daily lives of people: namely goodwill, fellowship, sympathy, and social intercourse among the individuals and families who make up a social unit.” Other academics such as Jane Jacobs (1961), Pierre Bourdieu (1983) and James S. Coleman (1988) have done much to carry the concept further over the years. More recently, Robert Putnam has become an important writer on the topic, and is also much responsible for bringing the term into popular use after his 2000 book Bowling Alone: The Collapse and Revival of American Community. In one of his earlier publications he writes, “social capital refers to features of social organization, such as networks, norms, and trust, that facilitate coordination and cooperation for mutual benefit” (Putnam, 1993). The Organization for Economic Co-operation and Development (OECD) has written much about social capital as it relates to their work. In one of their publications, Brian Keeley (2007) writes, “We can think of social capital as the links, shared values and understandings in society that enable individuals and groups to trust each other and so work together (Keeley, 2007).” It is challenging to bring all these definitions together. For the purpose of this paper, social capital will simply refer to: the values and social norms embedded in a society that create social cohesion, encourages individuals to trust each other and facilitates cooperation.

Europe as a society has been shaped, in large part, by an abundance of social capital that has allowed it to grow and prosper economically. The shared norms and values held by Europeans throughout the centuries—values such as honesty, keeping of commitments, respect for people’s property, safety and security, goodwill, self-sacrifice and reliable performance of duties—which are largely a result of the widespread adoption of Christian tradition, have been an essential, underlying foundation upon which European peoples have cooperated. The networks of trust, or social cohesion, created by these shared norms have enabled Europeans to work together to build an advanced, civilized society that could not have been possible without this abundance. The World Bank Group writes, “social cohesion is critical for societies to prosper economically and for development to be sustainable… [it] is not just the sum of the institutions which underpin a society – it is the glue that holds them together (World Bank, 2011).” Indeed, it was this unique abundance of social capital that led this small peninsula at the tip of Asia to be called by many as simply “The Continent;” it is what has made Europe “Europe,” distinct from its eastern roots (Fountain, 2004).

A growing body of research has demonstrated how social capital contributes towards economic growth and prosperity (e.g. Whiteley, 2000; World Bank, 2011; Iyer, Kitson & Toh 2005). Central to understanding how this works is the idea that certain norms and values (such as the ones mentioned above) actually have economic value in that they foster economically beneficial relationships and cooperation—and in doing so they lower transaction costs (Fukuyama, 2001). It is no coincidence that countries where interpersonal trust is higher and social capital is stronger also have the most developed economies (Knack & Keefer, 1997; Knack, 2002).

A good way to demonstrate how trust and social capital has economic value is to use an illustration. Vishal Mangalwadi, an Indian author and philosopher, describes in one of his books (Mangalwadi, 2009) his first visit to the Netherlands during which time he realized that trust is a valuable economic asset. On this visit while staying in a rural part of the country, his host took him to buy fresh milk. They walked to a neighbouring farm and entered through an unlocked door into the facility where cows were milked. His host proceeded to fill his milk jugs from the vat, and then deposited money into a jar. They proceeded to leave with their milk, never encountering another person during the entire transaction. Mangalwadi was dumbfounded. He did not understand what prevented others from coming to steal the money in the jar, or to at least take the milk for free (not to mention the cows). This brief example shows how social capital can contribute to economic prosperity—but also how fragile it is. Because the milk farmer trusted his neighbours to pay for their milk without supervision, it lowered the transaction costs. Conversely, if the farmer at some point experienced theft, he may lose trust and take precautions by hiring someone to manage the transactions, ultimately leading to an increase in the price of milk. Taking the argument even further, if the hired worker were not himself trustworthy, and only made rational decisions based upon his own return on investment, he might begin pocketing some of the money. Continuing to lose, the milk farmer may be tempted to boost profits by watering down his milk. His customers would then be forced to create a regulatory institution that could ensure quality—further hiking up prices. This scenario shows, albeit on a very small scale, how social cohesion has economic benefit, and how the breakdown of trust in an economy can have detrimental and far-reaching effects. Mangalwadi realized what European communities had that was largely lacking in his own country, and what was responsible for the relative difference in economic prosperity: social capital.

The breakdown of the trust relationship between public transport companies and those using public transport in the Netherlands was one of the main reasons for the introduction of the OV chip card system, and serves an example of how social cohesion is deteriorating in Europe. The system, which cost a fortune to implement, was a rational response by the public transport companies in the face of profit losses due to fraud on the part of commuters who could no longer be trusted to “punch in” with their strippenkaart (Thales Group, 2011). By deviating from the social norms (namely honesty and trustworthiness), and cheating the system, the very consumers who tried to avoid costs to themselves in the short term, effectively caused the prices of public transport to increase for the entire society. Similar phenomenon can be observed throughout Europe in the corporate world and even politics. As people place less value on the social norms that have helped to shape Europe, social cohesion deteriorates and people trust each other less. As social cohesion breaks down, individuals tend to make decisions based solely on their personal rate of return rather than what is beneficial or “right” for the network in which they are embedded.

There are numerous reasons why social capital can be said to be on the decline in Europe. One of the main reasons is the diminishing role of the family in society. Increasingly more children are growing up with only one parent, or with parents that do not live together (Morgan & Zippel, 2003). Additionally it is increasingly more common that both parents work, and therefore invest less time with their children. Traditionally, the family has played the greatest role in passing on important social values and norms that constitute social capital (Putnam, 2000). Another possible reason for the decline may be decreased involvement with religious institutions. Increasingly fewer Europeans affiliate themselves with religious beliefs (Pollack, 2008). Religious institutions have been shown to play an important role in the development of social capital (Fukuyama, 2001).

The reasons why these values and social norms are disappearing are many and varied, but the results are clear: trust disappears, and transaction costs increase as problems like corruption, bribery, fraud and criminality take their place. Studies have shown that corruption raises the cost of capital and uncertainty in the economy (Gray & Kaufman, 1998), and some studies have shown that corruption is even spreading in Western Europe (Porta, 1997). On the other hand however, the same study shows that society is also becoming more concerned about problems like corruption and wants to do more to fight them. Also, while many of the traditional values that have contributed to social capital are on the decline, other values such as tolerance, environmentalism and social responsibility are on the rise in Europe. Additionally, the average economic and social well-being in much of Western Europe has been steady or on the rise.

How does one reconcile these seemingly inconsistent trends? Perhaps social capital is merely changing form. One other possibility is that Europe is not yet fully experiencing the effects of its steady decline in social capital, but is still reaping the benefits of the strong social cohesion created by prior generations. If this is the case, it is only a matter of time until Europe undergoes a painful transformation. As social capital continues to decline, it may be that Europe no longer finds itself positioned next to the United States at the forefront of the global economy.

Fountain, J. (2004). Living as people of hope (p. 53). Rotterdam: Initialmedia. 

Fukuyama, F. (2001). Social capital, civil society and development. Third world quarterly, 22(1), 7-20.

Gray, Cheryl W.; Kaufman, Daniel (1998). Corruption and Development. World Bank, Washington, DC. https://openknowledge.worldbank.org/handle/10986/11545

Hanifan, L. J. (1916). The Rural School Community Centre. Annals of the American Academy of Political and Social Sciences. 67, 130-38.

Iyer, S., Kitson, M., & Toh, B. (2005). Social capital, economic growth and regional development. Regional Studies, 39(8), 1015-1040.

Keeley, B. (2007). OECD Insights Human Capital How what you know shapes your life: How what you know shapes your life. OECD Publishing.

Knack, S. (2002). Social capital, growth and poverty: A survey of cross-country evidence. The role of social capital in development: An empirical assessment, 42-82.

Knack, S., & Keefer, P. (1997). Does social capital have an economic payoff? A cross-country investigation. The Quarterly journal of economics, 1251-1288.

Mangalwadi, V. (2009). Truth and transformation: A manifesto for ailing nations. Seattle: YWAM Publishing.

Morgan, K. J., & Zippel, K. (2003). Paid to care: The origins and effects of care leave policies in Western Europe. Social Politics: International Studies in Gender, State & Society, 10(1), 49-85.

Pollack, D. (2008). Religious change in Europe: theoretical considerations and empirical findings. Social compass, 55(2), 168-186.

Porta, D. (1997). Democracy and corruption in Europe. London: Pinter.

Putnam, R. (1993). The prosperous community: social capital and public life. The American Prospect, 13(Spring), Vol. 4.

Putnam, R. (2000). Bowling alone: The collapse and revival of American community. New York: Simon & Schuster.

Thales Group (2011). The OV-chipkaart Story: A Nationwide Interoperable Fare Collection System in the Netherlands. ThalesGroup.com. Retrieved Dec. 13, 2014, from https://www.thalesgroup.com/sites/default/files/asset/document/thales_-_the_ovchipkaart_story_-_v2.pdf

The World Bank Group. (2011). What is Social Capital. Retrieved 12 11, 2014, from World Bank: http://go.worldbank.org/K4LUMW43B0

Whiteley, P. F. (2000). Economic growth and social capital. Political Studies,48(3), 443-466.

The Origin Of Things

I am fascinated by the incalculable number of things all around us, things that we take for granted and most often don't even notice. Where do they all come from? Who makes them? How are they made?

There is a knob on the stereo amplifier above my desk. Someone had to fashion that, had to design it and produce it. It must have been manufactured in a factory somewhere. By who? Using what? Did they make an entire machine just to make those particular knobs? Where were the parts for the machine made?

The perfectly shaped little rubber blobs that act as mini stands for my laptop. The strap of my watch, with all it's little separate pieces, ingeniously designed to function. The custom light fixtures in the storage unit I can see from my window. The glass jar sitting on my desk. The valerian root extract inside. The countless little pieces of metal and plastic, attached to just about everything, giving things their shape and structure, holding them together.

There are too many little things everywhere for me to begin to fathom! And the idea that each one of them has a story, a process that they went through, involving people and places, labor, and factories, machines, transportation, trade, money, design, assembly, placement and then sales. It is an inconceivably complex web!

Yesterday, I was in the main mail sorting center for Amsterdam. It is a gigantic warehouse full of machines, each one the size of a building itself, and each one full of countless rollers, latches, switches, clasps, belts and unnameable pieces and parts. These machines sort thousands of letters each minute. You can see them zipping by at a tremendous pace. If you thought a paper jam in your laser printer was annoying, imagine if one little letter in one of these machines jammed. They would have to call the professionals; no normal human would have a clue what to do!

All those little parts! I mean, someone must have designed the overall concept of the machine. And then engineers must have figured out how to build it. And then specialists must have specifically designed all the parts for it. And then manufacturers must have produced them--probably using other machines. Where does it end? Where does it begin?

Sometimes, when I drive through the city and look around, the sky scrapers, the bulldozers, the trains, I can't help but marvel at the ingenuity of the human race. We have accomplished so much. We have built so much. We have made things that our ancestors could not have been capable of imagining.

The scope of human imagination is astounding. And the ability to collaborate, and turn ideas into real things is a mysterious phenomenon to end-consumers like me. It would seem just as rational of an explanation (did I not already know some of the background) if I were told that it was all conjured by magic.

After all, what is the difference between technology we can't understand, and magic? We, for instance, discovered and harnessed radio waves: invisible forces that travel through the air at lightning speeds, completely undetected, transmitting voices and information to people far away. Our ancestors would find no other term satisfactory than "supernatural."

And magicians, who know well the secrets of their craft, probably find it quite hilarious that we call what they do magic!

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Thank You For The Mustard

I recently finished Chesterton's enduring masterpiece, Orthodoxy. I am still digesting it, re-reading sections at a time, trying to follow his thoughts. He is the finest writer I've ever come across. He uses so much paradox. The impression I get is that he is willing to turn the entire world upside down, if only he can get you to realize you've spent your entire life standing on your head!

I've always found it strange that many see Christians as narrow minded. Although, nowadays, after I've experienced much of the anti-intellectualism, thought-manipulation, and adherence to unfounded dogma that infects most of Christendom, I can see more why that accusation is in many cases valid. But I mean in more general terms, who is more open minded: the one who believes strictly in observable material laws that govern and determine, or the one who believes in a supernatural element to the universe? OK, that was rhetorical...

Chesterton puts it superbly:

"For we must remember that the materialist philosophy (whether true or not) is certainly much more limiting than any religion. In one sense, of course, all intelligent ideas are narrow. They cannot be broader than themselves. A Christian is only restricted in the same sense that an atheist is restricted. He cannot think Christianity false and continue to be a Christian; and the atheist cannot think atheism false and continue to be an atheist. But as it happens, there is a very special sense in which materialism has more restrictions than spiritualism. Mr. McCabe thinks me a slave because I am not allowed to believe in determinism. I think Mr. McCabe a slave because he is not allowed to believe in fairies. But if we examine the two vetoes we shall see that his is really much more of a pure veto than mine. The Christian is quite free to believe that there is a considerable amount of settled order and inevitable development in the universe. But the materialist is not allowed to admit into his spotless machine the slightest speck of spiritualism or miracle. Poor Mr. McCabe is not allowed to retain even the tiniest imp, though it might be hiding in a pimpernel. The Christian admits that the universe is manifold and even miscellaneous, just as a sane man knows that he is complex. The sane man knows that he has a touch of the beast, a touch of the devil, a touch of the saint, a touch of the citizen. Nay, the really sane man knows that he has a touch of the madman. But the materialist's world is quite simple and solid, just as the madman is quite sure he is sane. The materialist is sure that history has been simply and solely a chain of causation, just as the interesting person before mentioned is quite sure that he is simply and solely a chicken. Materialists and madmen never have doubts.

"Spiritual doctrines do not actually limit the mind as do materialistic denials. Even if I believe in immortality I need not think about it. But if I disbelieve in immortality I must not think about it. In the first case the road is open and I can go as far as I like; in the second the road is shut. But the case is even stronger, and the parallel with madness is yet more strange. For it was our case against the exhaustive and logical theory of the lunatic that, right or wrong, it gradually destroyed his humanity. Now it is the charge against the main deductions of the materialist that, right or wrong, they gradually destroy his humanity; I do not mean only kindness, I mean hope, courage, poetry, initiative, all that is human. For instance, when materialism leads men to complete fatalism (as it generally does), it is quite idle to pretend that it is in any sense a liberating force. It is absurd to say that you are especially advancing freedom when you only use free thought to destroy free will. The determinists come to bind, not to loose. They may well call their law the "chain" of causation. It is the worst chain that ever fettered a human being. You may use the language of liberty, if you like, about materialistic teaching, but it is obvious that this is just as inapplicable to it as a whole as the same language when applied to a man locked up in a mad-house. You may say, if you like, that the man is free to think himself a poached egg. But it is surely a more massive and important fact that if he is a poached egg he is not free to eat, drink, sleep, walk, or smoke a cigarette. Similarly you may say, if you like, that the bold determinist speculator is free to disbelieve in the reality of the will. But it is a much more massive and important fact that he is not free to raise, to curse, to thank, to justify, to urge, to punish, to resist temptations, to incite mobs, to make New Year resolutions, to pardon sinners, to rebuke tyrants, or even to say "thank you" for the mustard." - C.K. Chesterton Orthodoxy 1908 (Public Domain)

read more from Orthodoxy... 

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Dark Timelessness Of Non-Existence

What in God's name am I? I don't mean what sort of animal. I'm quite certain I am human. But I mean, what is my personhood, my consciousness, my self-awareness, my attention? In short, what makes up my mind?

Am I my brain? If my brain were to be in somebody else, would I still be me? If my brain were sitting on a shelf (yet somehow kept alive and active), would I still be me?

I think, yes.

But what I can't wrap my brain around, is this: am I my brain, or do I inhabit my brain? All evidence seems to point to the idea that I merely am my brain. Yet, I don't believe it. They say that every psychological occurrence in my mind, every thought, is simultaneously a physiological event in the brain. Ok. But that doesn't explain me.

During brain surgeries, they have shown that when they stimulate a certain place in the sensory cortex of the brain, the person will feel a sensation corresponding with the place they stimulated. They might poke here, and the person will feel as if someone touched their hand. They might poke there, and the person will feel as if someone is tickling their toes.

I suppose then, that if the technology existed, a scenario like in The Matrix, is perfectly plausible. We could exist in a reality completely separate from reality by connecting our brains to the proper sensory inputs. Of course, we all know it will be the gaming industry who will invent it!

What if someday, then (I really believe this to be probable), we are all just brains sitting on a vast array of shelves, connected together, without the need for bodies, living in a real-as-reality virtual existence, where the discomforts of real-reality don't have to irritate us anymore, and we can make up any reality (or set of realities) we want? Who would need (or even want) the real world? Of course this has been the subject of science fiction novels for decades.

But my question is what exactly is sensation? I see the mechanism of sensation, but where is the point where the neurological message is received? Just because a neurological pathway is stimulated in my brain, where am I to receive that message? Light waves may enter my eye at a particular frequency, my retina will pick them up, and my optic nerve will send a signal to other nerves in my brain, but at some stage I experience color.

But where do the signals end up? What good is a message if there is no one to receive it? Is the neurological pathway transmitting data me? If a packet of binary information is sent across an Ethernet cable to a computer, the website is only rendered if that packet is received and interpreted, and eventually displayed in a web browser. What good is the cable sending signals to other cables? But all I see in the brain are the cables!

Am I the cables? Power cables being lit up with data, transmitting in circles? Who experiences the signals? Are the signals the experience? It's a complex pathway consisting of millions of nerves that activates and is flooded with electricity and neurotransmitters, and... then it stops. Who is on the receiving end of that message?

If the signal is the sensation, then do cables, computers and circuit boards sense?

Imagine I were to die. Ok. Now, say my brain was perfectly preserved. All brain activity has long ago ceased. Much later, one of those clever brain surgeons pokes something in my inactive sensory cortex, suddenly stimulating the sleeping neural pathway that would cause the feeling of my hand being touched. Now, if I am my brain, would I not feel that?! Even though I am not concious, even though I know nothing, would I not still experience that sensation?

If the message is the experience, then yes, in the dark timelessness of non-existence, I would indeed feel someone touch my hand!

But it makes no sense to me. How can the mere activation of neurological pathways cause me to sense anything? There must be a recipient of the messages, on the other side of the brain. I can only conclude that I inhabit my brain. How can the thing be self-aware? How can the cable feel?

This is a conundrum that has bothered me for many years, and I cannot properly articulate it with words. I've tried here, and I don't expect you to see what I see. How can I craft my words to stimulate the same neural pathways in your brain that have been stimulated in mine?

I feel trapped in here.

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