Chapter 12

Social Capital at Work: A Manager's Guide

Alex MacGillivray


This chapter explains the importance of ‘social capital’ to business. Social capital is the stock of networks, stakeholder relationships and shared rules that help organizations and their surrounding communities work more effectively. in short, it is creative trust.

A well-known example is New York's diamond traders, who work in a tight network with minimal transaction costs due to their high levels of trust and common norms. it is also widely accepted that business soon becomes impossible when such networks and norms disappear – as has happened recently in Argentina, for example. What is not yet well enough understood is what role business can play in building ...

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