Measurement of Social Capital

There is considerable debate and controversy over the possibility, desirability and practicability of measuring social capital, yet without a measure of the store of social capital, its characteristics and potential remain unknown (Durlauf 2002b^[1]; Falk and Harrison 1998^[2]).
Measurement attempts are flawed by problems with separating form, source and consequences (Adam and Roncevic 2003^[3]; Onyx and Bullen 2001^[4]; Sobels et al. 2001^[5]). An example is trust, which is commonly seen as a component of social capital. Some authors equate trust with social capital (Fukuyama 1995^[6]; Fukuyama 1997^[7]), some see trust as a source of social capital (Putnam et al. 1993^[8]), some see it as a form of social capital (Coleman 1988^[9]), and some see it as a collective asset resulting from social capital construed as a relational asset (Lin 1999^[10]). Collier (2002)^[11] identified that social capital is difficult, if not impossible to measure directly and that for empirical purposes the use of proxy indicators is necessary. Social capital has constructs that are inherently abstract and require subjective interpretation in their translation into operational measures, that are invariably indirect surrogates of their associated constructs (Grootaert et al. 2002^[12]; Narayan and Cassidy 2001^[13]). Callahan (1996) supported this, identifying that while it is hard to measure social capital directly, it can be inferred from its powerful effects. The choice of indicators to measure social capital is also guided by the scope of the concept and the breadth of the unit of observation used (Collier 2002)^[11]. Social capital is such a complex concept that it is not likely to be represented by any single measure or figure. The multiple dimensions require sets of indicators to be effective (Cox and Caldwell 2000)^[14]. Considerations of measurement of social capital inevitably reflect the conceptual debates about social capital itself, in particular, whether social capital can be measured at an individual or community level (Baum and Ziersch 2003)^[15].

Measuring social capital clearly has an intrinsic appeal (Inkeles 2000) however, as Fukuyama (2001, p. 12) states, ‘one of the greatest weaknesses of the social capital concept is the absence of consensus on how to measure it’.] The measurement of social capital and the assessment of its contribution are certainly in their infancy (Fox 1997). Daniere, Takahashi et al (2002a) suggested that existing measures of social capital are subject to criticism because researchers often define terms differently and because it is difficult to develop concrete, tangible evidence of social capital that lends itself to quantitative analysis. Durlauf (2002) supported this, positing that many definitions mix functional and causal conceptions of social capital and that causal definitions of social capital are necessary for successful empirical analysis. Paxton (1999) identified the widening gap between the concept of social capital and its measurement. The popularity of the term seems to have encouraged the use of overly-aggregated, heterogeneous indexes (Knack 2002). Due to the abstract nature of social capital and varying definitions, it is often measured inconsistently between studies (Liu and Besser 2003). Previous studies provide little rationale for how their measures of social capital connect to the theoretical definition of social capital (Paxton 1999). Stone (2001) posited that there are insufficient tools for empirical measurement available and this is an area where further research is required despite the extensive work of the Australian Bureau of Statistics (2002), Bullen and Onyx (1998), Lochner, Kawachi et al (1999), Onyx and Bullen (2000) and Stone and Hughes (2002). Cavaye (2004, p. 13) identified the following issues in the measurement of social capital that remain unresolved:

• A clear understanding of the context and purpose of the measurement of social capital
• Understanding the limitations of evaluation and measurement, and ensuring that the interpretation of measures is held within these limitations
• The practical mechanics of gaining community feedback such as community representation and coverage, feedback to communities, use in local decision making, and resourcing measurement
• Benchmarking vs. measures of incremental change
• Dealing with qualitative information, diversity, variation and complexity
• The nature and rigor of indicators
• The interpretation and use of measurement information
• How evaluation itself can contribute to fostering social capital.

Fukuyama (2001) posited that producing anything like a believable census of a society’s stock of social capital is a nearly impossible task, since it involves multiplying numbers that are either subjectively estimated or simply non-existent. Measurement of social capital becomes self fulfilling as one tends to find what one is looking for but does not tend to question the path (Inkeles 2000; White 2002). In fact, the concepts usefulness appears to be limited in that it is difficult to operationalise using proxy measures that are distinct from the predicted effects (Falk and Harrison 1998; Krishna 1999; Sobels et al. 2001; Woolcock 1998). This is further supported by Stone (2001, p. viii) who stated that ‘where social capital has been measured to date, it has often been done so using ‘questionable measures’, often designed for other purposes, and without sufficient regard to the theoretical underpinnings of the concept to ensure validity or reliability’. The act of measuring social capital can and probably will affect the stock of capital that is being assessed, which adds further questions to the suitability of attempts to empirically measure social capital (MacGillivray and Walker 2000; Popay 2000).

Grootaert and Van Bastalaer (2002a) on the other hand posited that it is possible to measure social capital and its impact. Onyx and Bullen (2000b) claimed they have developed a reliable and valid measure of social capital one that is relatively easy to apply. Ideal indicators recognize that social capital can be expressed through attitudes and expectations; through reported, recorded and observed actions and activities; and by comparing people’s interpretations of how things happened or are expected to happen (Cox and Caldwell 2000). Ideally, measures of social capital should be thoroughly based on, and tied to, the conceptual framework for the specific study. Cavaye (2004) described the development of consistent frameworks and that there are no best indicators, rather some key characteristics that guide the choice of indicators such as:

• specificity targeted to the variable to be measured,
• measurability – ease of measurement,
• comprehensiveness – measures of a range of social characteristics,
• reliability and rigor,
• continuity ability to translate across situations and be consistent in local state or national frameworks.

The challenge is to develop consistent indicators that can allow conclusions to be drawn across local, state and national frameworks (Cavaye 2004).

A report by the Productivity Commission (2003, p. 25) made the following observation about the measurement of social capital:

Like the theoretical literature, the empirical literature is evolving. Because social capital as a concept is relatively new, multifaceted and imprecise, ‘hard data’ on it are not readily available. Inevitably, many early studies have had to rely on rough proxies for social capital and/or have been somewhat experimental. Hence, the results need to be interpreted with care; in most cases they are ‘suggestive’, rather than definitive.

Some authors have applied various indicators of social capital in different contexts. Examples include:

• trust (Cox and Caldwell 2000; Falk and Guenther 1999; Glaeser et al. 2000; Guenther and Falk 1999; Kolankiewicz 1996);
• membership (Baum and Ziersch 2003; O’Connell 2003; Price 2002; Warde et al. 2003; Wollebaek and Selle 2003);
• membership and trust (Lappe et al. 1997; Lochner et al. 2003; Veenstra 2002);
• membership, trust and norms of reciprocity (Isham et al. 2002; Skrabski et al. 2003; Staveren 2003); and
• network resources (Zhao 2002).

Grootaert (2001) identified the indicators detailed in table 4 as having all been used in empirical studies.

The relative success and appropriateness of these studies depend on the local context under which the indicators were applied but ultimately, as discussed earlier, such measures do not take into account the multi-dimensional nature of social capital and the inherent source, form, consequence problems. Other more multi-dimensional measures have been undertaken, however the problems discussed above have not been overcome. Studies including:

• Narayan and Princhett (1997) constructed a measure of social capital from a survey of 87 villages in rural Tanzania, which examined social capital and ‘village-level outcomes’;
• Onyx and Bullen (1997) sought to measure social capital in five localities in New South Wales using a 68-question survey;
• Barr (1999) used experimental game theory techniques to measure trust and familiarity in selected black communities in Zimbabwe; and
• Putnam (2000) see figure 10.

Figure 10. Putnam’s indicators of social capital for the United States

Source:Putnam (2000) cited in Productivity Commission (2003).

As identified in the literature review, and illustrated in the conceptualization, the operationalization of social capital is made difficult by the problem of separating the source, form and consequences. The nature of social capital means that it is necessary to use a proxy or indicator of social capital, as it cannot be directly measured. Past empirical studies have used indicators that relate to the outcomes of social capital. A useful distinction is the classification into proximal and distal groupings. Proximal indicators of social capital are in fact outcomes of social capital related to its core components (networks, trust and reciprocity). Distal indicators are outcomes that are not directly related to its key components and thus may not be valid measures of social capital itself. There is little empirical evidence to support the relationship between indicators and the core components of social capital. This highlights the tautological problem that research reliant upon an outcome of social capital as an indicator of it, will necessarily find social capital to be related to that outcome, without empirical means to explain why, or indeed whether, this is so (see Stone 2001 for further discussion). Social capital can be seen as the structure and quality of social networks. As such, the core dimensions of social capital are seen to be networks of social relations (structure), which are characterized by norms of trust and reciprocity (quality) (refer to table 6).

Source: Stone (2001, p. 7)

Stone (2001, p. 6) stated that ‘by linking social capital measurement directly to theoretical understandings of the concept, we are able to: first, recognize that social capital is a multidimensional concept comprising social networks, norms of trust, and norms of reciprocity; second, understand social capital properly as a resource to action; and third, empirically distinguish between social capital and its outcomes’. This provides a sound basis for developing a measurement framework but much work is required to ensure the indicators relate to this theoretical understanding. If we break down one of the core dimensions, social networks, the complexity becomes immediately evident. In table 7, networks are broken into informal and formal and the types evident at the macro level listed. For each of the types listed in the table a series of questions could be developed. However the problem of how they relate to the theoretical understanding remains unresolved. Other problems also become evident. This macro level analysis of social capital is of little use to the majority of studies that investigate social capital at the meso level. This illustrates the context specific nature of suitable social capital measures. Other issues remain unresolved such as spatial and temporal issues, externalities, feedback loops, and the role of chance in shaping both the structure and the outcomes. It is implausible to add bridging capital to bonding capital and subtract perverse social capital.  Thus an amount of social capital should not be sort, not even qualitatively. Instead, social capital should be analysed in terms of a composite of its disparate, yet interrelated, components. Therefore, social capital building initiatives should aim to improve the structure of social capital rather than increase social capital per se.

Source: Stone (2001, p. 7)

Natural resource management applications of social capital can involve micro to macro level analysis. The primary level of interest is the meso level as studies focus on the application of social capital theory to an area of common interest: natural resource management. The focus can be on micro individuals; meso – groups of individuals, groups of like groups, groups of natural resource management groups, or national natural resource management groups; or macro societal (refer to figure 11). This situation is further complicated when taking into account various institutions associated with natural resource management, including voluntary, non-government, government and private sector. The structural elements of social capital will be different depending on the level of study, as will be the relationships between determinants, structure, manifestations and levels, even those levels not under investigation.

An important finding for this study is that social capital application to natural resource management must involve a rigorous conceptualization that accounts for the interrelationships and complexity of the concept.  The above discussion highlights the importance of designing the operationalization of social capital specifically to the application context. It is concluded that there is presently no suitable measure of social capital and thus no suitable measure for application to natural resource management. The adoption of an existing measure for use in natural resource management would contribute to the existing problem of measurement not being linked to the theoretical understanding of social capital.