Measuring social capital for local economic development studies: the case of French rural areas

The notion of social capital is based on the idea that social relationships and social norms may give access to valuable resources that can improve the welfare of individuals (Fafchamps and Minten, 2001), families (Narayan and Pritchett, 1997), communities (Bowles and Gintis, 2002) or even regions or nations (Knack and Keefer, 1997). The notion of social capital is an attractive attempt to synthesise the various effects of sociological and institutional factors on economic welfare. The fact that social relationships have a significant impact on individual economic success has a sound theoretical and empirical basis (Burt, 2000). However, dealing with issues of regional economic development, the role of sociological factors are much more debatable (Durlauf and Fafchamps, 2004). One problem in testing the role of social capital on development is that indicators of the relevant sociological features are generally lacking in statistical databases. In fact, the choice of variables that are used in empirical studies is generally justified not by theory but by practical availability considerations.