Building prosperous communities: the effects of social capital, financial capital, and place

Social capital, narrowly defined as networks of individuals who are linked through bonding or bridging relationships, has become a much discussed but poorly interrogated concept within studies of place based development. Too many studies are done at a county level with poor proxies for the concept. Empirical fieldwork also suffers when it fails to account adequately for contributing factors and alternative explanations for observed socioeconomic outcomes. If planners and policy makers are to utilize the power of a deeper understanding of how social relationships influence development actions, research inquiries must use the proper scale of analysis and test for mitigating and influencing conditions. This research uses case studies of community rural development projects as the lens for examining a functioning social network. I chose projects in communities that have both high and low socioeconomic outcomes and use two counterhypotheses to test for the impact of financial resources and attributes of place. This research avoids the aggregation bias found in county level work but cannot completely eliminate the difficulties in operationalizing the concept of social capital. My findings build on the work of others who have sought to integrate an understanding of mechanisms of social capital with the amount and distribution of financial capital and the historical development and place specific characteristics in a community. First, I found strong evidence to suggest that the amount of financial capital available within a network affects the types of ties actors will have within their networks and the ties they will use or seek during a project. Less prosperous communities have fewer locally owned businesses, businesses with surplus capital, and individuals with surplus financial capital. With less financial capital available, actors embedded in networks in less prosperous counties were more frequently required to leverage their existing social capital to form new ties, often bridging ties, in order to access financial capital. Second, I found evidence that historical settlement patterns and ownership of assets continues to influence present day social networks. These differences do not preclude places from having social ties or using social ties to address local development. These characteristics do, however, influence the number and diversity of groups in a community, the nature of bridging and bonding ties, and the different landscapes that social capital must navigate