This thesis investigates the nature and level of social capital and the level of economic development in two comparable towns in regional Australia, Goondiwindi and Stanthorpe. Both are small agricultural service towns in southern Queensland.
The hypothesis driving the research states that within two comparable communities, the community with a high level of social capital will demonstrate a high level of economic development, while the community with a low level of social capital will demonstrate a low level of economic development. Furthermore, it is considered that a high level of social capital will exert a positive causal influence on the level of economic development.
The level of economic development of the two communities under study is measured by reference to 1996 census data - key characteristics of individuals in each community that are essentially a product of economic development £ire used to provide a proxy for the level of economic development. Goondiwindi is thus categorised as a town with a comparatively high level of economic development, while Stanthorpe is categorised as a town with a comparatively low level of economic development.
Social capital is conceptualised as the outcome of a process i.e. a resource, which may be utilised in the achievement of desired goals, including economic development. The thesis is critical of much existing research into social capital which it is argued fails to appreciate the complexity of the concept and its manifestation. A secondary aim of the thesis is therefore to provide empirical evidence to justify or not, the validity of a range of commonly used proxy indicators of social capital.
Social capital is measured through a quantitative survey questionnaire which received 243 valid responses, and qualitative research incorporating interviews with ten community members and an analysis of local newspapers. The survey questions are designed to investigate aspects of individuals' lives of theoretical relevance to the concept of social capital. These include societal structures such as voluntary group association, informal association with friends and neighbours, work and family ties, and societal norms such as trust, civicness, and generalised reciprocity.
Responses to the survey are subject to a factor analysis which identifies six component elements of social capital and these are aggregated to generate a measure of general social capital for each community. The six component elements are: informal association with friend and neighbours (including generalised reciprocity); bridging social capital; family social capital; community engagement; thin trust and work social capital.
In identifying these elements of social capital the research questions the established theoretical connection between crime and social capital, and questions the use of crime and civicness as proxy indicators of social capital. The thesis also investigates the connection between each element of social capital and a range of demographic variables to present a clear demographic profile of ‘social capitalists’. Such people are identified as being female, home owners, moderately economically well-off and followers of a religion.
In regard to economic development, as hypothesised, Goondiwindi is found to hold a higher level of social capital than Stanthorpe. Goondiwindi generates a higher score on each element of social capital, including general social capital. An assessment of qualitative data reveals the mechanisms through which social capital is exerting an influence on the level of economic development suggesting a causal relationship from social capital to economic development. This relationship is also supported by a review of the available statistical evidence, although the limitations of the data are acknowledged.
The thesis offers empirical support for earlier claims from Woolcock (1998, 2001) and Woolcock and Narayan (2000) in concluding that the synergistic operation of both bonding and bridging social capital will foster the development of engaged communities and this is of crucial importance in facilitating enhanced economic development outcomes within the context of a small regional community.