Social Capital, Intellectual Capital, and the Organizational Advantage
Templeton College, Oxford
London Business School
Abstract(Nahapiet, Janine; Ghoshal, Sumantra. 1998. Social Capital, Intellectual Capital, and the Organizational Advantage. Academy of Management Review, vol. 23 no. 2, pg. 242-266.)
Scholars of the theory of the firm have begun to emphasize the sources and conditions of what has been described as "the organizational advantage," rather than focus on the causes and consequences of market failure. Current research develops several arguments, including:
A model is presented that incorporates this overall argument in the form of a series of hypothesized relationships between different dimensions of social capital and the main mechanisms and processes necessary for the creation of intellectual capital.
- Social capital facilitates the creation of new intellectual capital.
- Organizations, as institutional settings, are conducive to the development of high levels of social capital.
- It is because of their more dense social capital that firms, within certain limits, have an advantage over markets in creating and sharing intellectual capital.
To appear in "Strategic Management of Intellectual Capital and Organizational Knowledge" edited by Nick Bontis & Chun Wei Choo (Oxford University Press).