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Is corruption a dark side of social capital? Correlation or causality?

Many people have asked me whether social capital is correlated with corruption? I don’t think the answer to this question is relevant because I don’t think social capital is a primary causal factor.

I think social capital would prohibit corruption in some contexts and promote it in others. Therefore any study of correlation would be confounded by adding positive and negative numbers.

I think that social capital would “lubricate” corruption if other factors exist that promote corruption. Or put another way, where the conditions for corruption exist higher levels of social capital would allow for more corruption to occur.

At this point I emphasise an important distinction: I am referring to social capital at the organisation level, not social capital at a macro societal level. Some elements of macro level social capital such as trust are likely to have a causal relationship with corruption.

I think it is helpful to separate the source, form and consequences of social capital. In the context of Nahapiet and Ghoshal’s (1998) work, the three dimensions of social capital (structural, cognitive, relational) represent the form of social capital. This form (it can be useful to think of the form of social capital as its structure or elements) is separate from its consequences (ie manifestations).

The same form (trust, norms, network ties, etc) can result in very different consequences in different contexts. So social capital (ie its form) can result in consequences of reduced corruption or increased corruption depending on the underlying propensity for corruption to occur.

Where corruption can occur social capital will facilitate corruption because trust, norms, network ties, etc will give people the means and confidence to engage in corruption.

In the reverse context where corruption is not likely to occur, the same factors (trust, norms, network ties, etc) will discourage corruption due to fear of social sanctions, betrayal of trust and loss of network ties, etc.

The conditions for corruption to exist are rooted in culture; the organisational culture within the context of the macro societal culture within which it operates.

The literature discusses numerous cultural factors such as moral values, trust, transparency and accountability, power structures and dynamics, and a range of cultural artifacts such class or caste systems, the existence of inequality and poverty, liberal democracies, and free press to name a few.

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