Notes
For a similar warning about the dangers of functionalism in the neoclassical analysis of social capital, see Knorringa and van Staveren (2007:2). It should be noted, however, that North (1990) and other new institutionalist scholars go to great lengths to dispel the notion that only the most efficient institutions ‘win out’ in the evolutionary process. Further, in his later work, North (2005) examines the ways in which belief structures, or mental models, shape the process of institutional change (or in other words, how the social embeddedness of institutional change matters).
For a case study, see Granovetter and McGuire (1998).
As Smith put it in The Wealth of Nations, ‘In civilised society [man] stands at all times in need of the cooperation and assistance of great multitudes, while his whole life is scarce sufficient to gain the friendship of a few persons’ (Smith [1776] 1991: Book I, chp. 2: 18).
Also see von Mises ([1949] 1966: 143–76, 194–99), who argued that sympathy and friendship can be the product of trade, not just its cause.
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Lewis, P., Chamlee-Wright, E. Social embeddedness, social capital and the market process: An introduction to the special issue on Austrian economics, economic sociology and social capital. Rev Austrian Econ 21, 107–118 (2008). https://doi.org/10.1007/s11138-007-0033-1
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DOI: https://doi.org/10.1007/s11138-007-0033-1