As an example of the first consequence, a member of an ethnic group may
endow a scholarship for young co-ethnic students, thereby expecting not repayment
from recipients but rather approval and status in the collectivity. The
students social capital is not contingent on direct knowledge of their benefactor,
but on membership in the same group. As an example of the second effect,
a banker may extend a loan without collateral to a member of the same religious
community in full expectation of repayment because of the threat of community
sanctions and ostracism. In other words, trust exists in this situation
precisely because obligations are enforceable, not through recourse to law or
violence but through the power of the community.
In practice, these two effects of enforceable trust are commonly mixed, as
when someone extends a favor to a fellow member in expectation of both
guaranteed repayment and group approval. As a source of social capital, enforceable
trust is hence appropriable by both donors and recipients: For recipients,
it obviously facilitates access to resources; for donors, it yields approval
and expedites transactions because it ensures against malfeasance. No lawyer
need apply for business transactions underwritten by this source of social capital.
The left side of Figure 1 summarizes the discussion in this section. Keeping
these distinctions in mind is important to avoid confusing consummatory and
instrumental motivations or mixing simple dyadic exchanges with those embedded
in larger social structures that guarantee their predictability and course.
As an example of the first consequence, a member of an ethnic group may
endow a scholarship for young co-ethnic students, thereby expecting not repayment
from recipients but rather approval and status in the collectivity. The
students social capital is not contingent on direct knowledge of their benefactor,
but on membership in the same group. As an example of the second effect,
a banker may extend a loan without collateral to a member of the same religious
community in full expectation of repayment because of the threat of community
sanctions and ostracism. In other words, trust exists in this situation
precisely because obligations are enforceable, not through recourse to law or
violence but through the power of the community.
In practice, these two effects of enforceable trust are commonly mixed, as
when someone extends a favor to a fellow member in expectation of both
guaranteed repayment and group approval. As a source of social capital, enforceable
trust is hence appropriable by both donors and recipients: For recipients,
it obviously facilitates access to resources; for donors, it yields approval
and expedites transactions because it ensures against malfeasance. No lawyer
need apply for business transactions underwritten by this source of social capital.
The left side of Figure 1 summarizes the discussion in this section. Keeping
these distinctions in mind is important to avoid confusing consummatory and
instrumental motivations or mixing simple dyadic exchanges with those embedded
in larger social structures that guarantee their predictability and course.
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