Well-being in Developing Countries
Edited by Jonathan Isham, Thomas Kelly and Sunder Ramaswamy
Chapter 5: Social Capital, Education and Credit Markets: Empirical Evidence from Burkina Faso
Christiaan Grootaert, Gi-Taik Oh and Anand Swamy This chapter tests empirically the central idea that, given available resources, technology and formal institutional structures, economic outcomes can vary depending on the nature of social norms and relationships. For example, consider a set of communities in a typical developing country. All else being equal, communities with inactive parent–teacher associations might be expected to have schools of little value. Likewise, communities with lenders and borrowers that trust each other might be expected to have credit markets that function more smoothly. This chapter examines the role of social capital in affecting well-being through these two specific channels: the performance of educational institutions and the functioning of credit markets. Using data collected from households in Burkina Faso, this study uses indicators of membership in associations and characteristics of communities to assess the impact of social capital on school attendance and distress sales. The main findings are that (a) community participation in parent–teacher associations is associated with substantially higher rates of school attendance, and (b) the incidence of consumption crises, as indicated by distress sales, is substantially lower in villages in which community lending institutions are active. The chapter is organized as follows: The next section describes the survey on which this chapter is based. The third section focuses on education and the fourth on consumption crises. The final section concludes with summary observations. ANALYSING AND MEASURING SOCIAL CAPITAL AT THE HOUSEHOLD LEVEL: HOW CAN THE OVERALL IMPACTS OF SOCIAL CAPITAL ON WELL-BEING BE...
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