An investigation of the role of social capital in the determination of participation in high risk informal financial services

Abstract

Bourdieu's Social Capital (Fine 1999) has been dubbed as the buzz word within the social sciences (Fine, 2007). The Theory of Social Capital is one of the micro theories that has dominated the development world since the departure from the grand theories of Modernisation, Dependency and World Systems. Despite the fact that Social Capital has gained remarkable prominence during the 1980s, its first appearance in development literature can be dated as far back as the 1950s. In its simplest sense Social Capital can be understood as the 'capital of the poor', which consists of the "norms and networks that enable people to act collectively" (Woolcock & Narayan, 2000: 225). This capital of the poor is not as straight forward to measure as other forms of capital. It is very complex and multidimensional. It also manifests itself in variable ways across contexts and time. In the case of this study two indicator variables were relevant for its measure: trust and networks.