Communities, Social Capital and Public Policy: Literature Review

This review explores the meaning and relevance of community and social capital drawing on a wide range of disciplines, in particular economics.

A policy research paper (No. 26) from the Research Publications Unit of the Australian Department of Family and Community Services written by David Johnson, Bruce Headey and Ben Johnson of the Melbourne Institute of Applied Economic and Social Research.

The purpose of this literature review is primarily to clarify issues and assess evidence in relation to:

• concepts and competing definitions of community and social capital
• measurement—how best to measure community integration, social networks and social capital
• empirical claims about the sources, benefits and potential costs of stronger communities and social capital.
  

The review suggests four key principles for measuring community strength and social capital:

• distinguish between the structure (size, density) of community networks and their content (norms of trust, reciprocity and participation)
• specify precisely the geographical area and/or type of organisation to which measures apply
• develop measures of community/networks/social capital that can be validly presented at both individual and aggregate levels
• always asses the costs and benefits of social capital empirically and never assume that all social capital is benign

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