This paper explores how social capital has been formed through comparing the Third Italy and Silicon Valley, the typical models of industrial district. The social capital has contributed to social economic performance which can not be explained by tra...
This paper explores how social capital has been formed through comparing the Third Italy and Silicon Valley, the typical models of industrial district. The social capital has contributed to social economic performance which can not be explained by traditional capital concept. And nowadays also industrial district has been focused in context of localization.
Since the 1970s, Fordism had fallen in a crisis, The Slump and After-Fordism has been introduced as its alternative. In terms of this phase, many social scientists and economists have examined the concept, ‘flexible specialization’ to search for the solutions to the flexibility problem. Flexible specialization is most distinguished in regional economies based ‘industrial district’. In this discussion, ‘social capital’ has had attention. First, by traditional concept of capital we can not understand regional economic success. Second, without the new concept of social capital we can not reorient regional policies. Third, now we know that social capital makes economic actors in the industrial district compete and cooperate each other.
As industrial district varies in forms, social capital also has a wide variety; the Italian form versus U.S. form. For example, in the Third Italy, informal forms of social capital - thick trust, generalized reciprocity and network of civic engagement - are observed relatively frequently and are based on communities which have been formed in the long history. In other words, ‘path-dependency’ is the origin of those informal forms of social capital. So, the root of the formation of social capital in the Third Italy can be drawn from the history of the communities.
On the contrary, in Silicon Valley there is no long history like the Third Italy. Furthermore, complex familial ties and structured-communities are hardly seen. Rather, formal forms of social capital which are connections between industries and universities, venture capital and flexible labor market, etc. can be obviously observed. The social capital in Silicon Valley has been formed by the basis of ‘path-formation’ in which economic actors form their own paths for the enhancement of short-term viability. On the center of the formation of social capital in Silicon Valley is collaborative network between regional, economic, institutional actors who pursue consistent innovation, competition and commercialization on the foundation of path-formation.