Chapter 5: The determinants of social capital
After measuring social capital across European regions, this chapter illustrates the theoretical arguments that support the choice of income inequality, labour market participation, national divergence, and economic development 1 as explanatory variables of social capital variation over other predictors (Table 5.1). Previous theoretical (see Tocqueville 1961; Gorz 1992; Putnam 1993) and quantitative work (Knack and Keefer 1997; Costa and Kahn 2003; O’Connel 2003) indicates that these predictors constitute an adequate deductive framework and should explain a lot about social capital variation. Income inequality was considered by Tocqueville to be the main explanation for the high level of social participation and trust in the United States (Tocqueville 1961: 8). Furthermore, at the empirical level, many scholars (Knack and Keefer 1997; O’Connel 2003; Paxton 1999; Costa and Kahn 2003) showed the existence of a negative correlation between income inequality and social capital. Labour market participation captures the existence of a potential relationship between work involvement and willingness to participate in voluntary associations, to network with family and friends and to trust others and institutions (Gorz 1992). Also the correlation between social capital and labour market participation has been investigated at the empirical level. However, much attention has been devoted to the analysis of the impact that social capital has on the access to the labour market (De Graaf and Flap 1988; Granovetter 1973; Fernandez et al. 2000; Munshi 2003), rather than exploring the potential effect that a variation of labour market activity may have on social capital.
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