Analysis On The Relationship Between Social Capital And Economic Growth

Economic growth and development since World War II is becoming the world's core social and economic affairs, and also is the subject of economic theory. In particular, economic growth and development in developing countries have a "catch up" characteristics, causes a more urgent need for relevant research. Although, social capital theory originated in Western countries, many aspects of the theory are not mature, given China's specific national conditions, which provide a great condition for the development of social capital theory with Chinese characteristics. Considering east Asian countries affected by Confucianism, focusing on social network and trust-oriented training, which provided a large amount of material for scholars who are in the research. This article uses the basic theory of economics, combined with the existing results of social capital theory, to present a basic framework from the perspective of social capital, which shows the constraints of economic growth.Due to the lack of authoritative quantify measurement standards on the relationship social capital and the domestic economic growth. Most quantitative researchers mainly adopt such indicators as trust and numbers of social organizations for replacement. By examining the relationship between these indicators and GDP, scholars try to demonstrate the effect of social capital on economic growth. Usually, the confidence index came from the 2000 survey of Weiying Zhang, which can not reflect the current state of social capital development. In addition, whether social capital can be summarized briefly by these indicators are inconclusive, therefore, its findings are still large uncertainties. Domestic research on the relationship between social capital and economic growth is very extensive, but all levels of these studies hasn't make up an organic integration yet, which makes it difficult to judge the whole influence on economic outputs. Considering all the reasons above, this paper explores how social capital effect participants and institutional factors in economy, trying to uncover the mechanism of the effect and deepen the understanding of social capital and put forward suggestions to promote economic growth. To sum up, this article may be summarized as follows:First, there is an overview of the existing social capital researches and its characteristics; then, studies the impact of social capital on human behavior, which embedded in the home network, and analyzes the relationship between financial firms and social capital, form which draws a conclusion that trust is the base of Financial enterprises. Third, distinct internal and external social capital, and make models of internal and external capital, expecting to find intuitive evidence of their impact on the production function. Next, explores the relationship between social capital and government, discovering that there exists a special kind of social capital in government - the government authority, further studies the behavior of rent-seeking and corruption, and provides interpretation of government failure from the perspective of social capital. Finally, I try to study the relationship between social capital and institutional change which has been rarely mentioned. The conclusion is that social capital, not only a lubricant of social stability, but also a promoter of social changes, plays an important role in the public choice.Through this article, we get the following revelation, to achieve sustainable economic development, there is not only need to increase the physical capital, human capital, capital-output ratio, but also have to pay attention to the cultivation of social capital. Social capital can reduce the transaction costs, enhance trust and cooperation of enterprises, and effects the acts of government. In spite of this, social capital is an important factor in institutional change too. However, the impact of social capital on various economic entities is not consistent, therefore, the effect of social capital on economic growth is uncertain.