Globalization, Social Capital and Inequality

Globalization, Social Capital and Inequality

Contested Concepts, Contested Experiences

Edited by Wilfred Dolfsma and Charlie Dannreuther

This volume investigates the relationship between globalization, inequality and social capital, and reveals that although strongly related, these ideas are also highly contested. The authors elucidate the interactions between these concepts, looking in detail at the conflicts and competitiveness which can arise at both the national and organizational level.

Chapter 3: Social capital and systemic competitiveness

Klaus Nielsen

Subjects: economics and finance, institutional economics


Klaus Nielsen INTRODUCTION International competitiveness is a strongly contested concept academically. Some regard it as a ‘dangerous obsession’ (Krugman, 1996); others consider it a useful analytical concept; whereas yet another group takes it seriously merely as an important political slogan (see the overview in Rapkin and Strand, 1995). Social capital is a concept which is being criticized for being too elastic; the term is seen as inadequate to explain the range of empirical situations demanded of it; it is seen to confuse sources with effects; it justifies contradictory policies and understates negative effects (Woolcock, 1998), p. 159). This chapter combines these two concepts. The various determinants of competitiveness and their relationships are analysed by means of the concept ‘systemic competitiveness’. Some of the determinants of ‘systemic competitiveness’ originate at the societal metalevel. This chapter uses the concept ‘social capital’ in an attempt to develop more concrete and operational ideas about the role of such meta-level factors for international competitiveness. The increasing discussion and application of social capital reflects a general tendency to focus on the connection between economic performance and the invisible social ‘glue’ which facilitates coherence and coordination of economic behaviour. Theories of innovation systems and business systems represent prominent attempts to explain different rates and directions of technological change and different economic structures by reference to such ‘glue’ in its typically nationally specific, path-dependent forms. Social capital can be seen as a more general concept covering these issues. The chapter aims at conceptual clarification of both systemic competitiveness...

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