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WHAT SOCIAL CAPITAL IS
"Social Capital" is made up of personal bonds of trust
and reciprocity. It has been simply defined as "the
collective value of whom we know and what we’ll do for each
other." Like other forms of capital, people invest in it as
they help others achieve their objectives, and draw upon it in
order to achieve their own objectives. In this sense, social
capital is fundamental to formation of other types of capital:
financial capital, human capital, intellectual capital. That is,
whenever a bond of trust and reciprocity is established, the
flow of other forms of capital becomes more fluid and richer.
HOW SOCIAL CAPITAL IS EXCHANGED
Social capital is exchanged whenever one person makes a
trusted referral to another person. This effectively transfers
some level of trust and reciprocity that has accumulated in an
established relationship to a new relationship. However, unlike
money, when social capital is exchanged, no one has to give it
up in order for someone else to get the benefit of it. Social
capital is only lost when trust and reciprocity aren’t
maintained as people expect them to be. For example, if I say
I’ll help you if you’ll help me, and then I don’t help you
as you expected, then my social capital will diminish. Likewise,
if I suggest to you that John is someone you can trust to get
something done, and then John turns out to be incompetent or
dishonest, then John will lose social capital (trust and
reciprocity) with me, and I will lose social capital with you.
There are already established networks and protocols to support
exchange of other types of capital, i.e., stock exchanges,
commodities exchanges, information and knowledge exchanges.
Establishing an exchange for trust and social capital is
naturally the last exchange to be enhanced by technology and
global protocols, because trust and social capital are extremely
personal, private, and hardest to standardize or commoditize (if
not impossible).
Yet, the value of improving the efficiencies of exchange of
trust are immense for all sectors of society: business, civil
society, and government.
To understand how the Trust Exchange works, see Enabling
Technology. |
