Growth and social capital: an evolutionary model

Luca Correani, Fabio Di Dio () and Giuseppe Garofalo

MPRA Paper from University Library of Munich, Germany

Abstract: In this paper, we analyze the role of cooperation between firms through a model of growth and social capital. In a growth model à la Solow we incorporate the set of resources that a relational network has at its disposals, as a distinct production factor, and thus examine its dissemination through evolutionary type processes in firm interactions. Dynamic analysis of the model demonstrates that cooperation is able to increase the productivity of factors, fostering a higher rate of growth in the long term. The most significant result is that scarcity of social capital can produce a general collapse of the economic system in areas in which long term growth is usually sustained by the learning by doing and spillover of knowledge phenomena. This conclusion leads to reconsider the role of local development economic policies that should concentrate on activities that promote repeated interaction between firms proven to be cooperative or that encourage the formation of technological consortia.

Keywords: Economic growth; Social capital; Networks; Evolutionary games (search for similar items in EconPapers)
JEL-codes: C71 O43 (search for similar items in EconPapers)
Date: 2009
New Economics Papers: this item is included in nep-evo, nep-fdg, nep-gth and nep-pke
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Journal Article: Growth and social capital: an evolutionary model (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:17043

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