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		Issue #34
		It's not what you know - it's who you know! Economic analysis of social capital

		Friends in high places? An overview of Social Capital

		Pathways of influence in South Africa

		Preferential credit for ethnic firms?

		Choosing better technology. Does social capital help?

		Networking for success and survival in Ghana?

		Unequal access to social capital in Tanzania

		Sites for Sore Eyes: Online Sources on Social Capital

September 2000 Insights Issue #34

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Choosing better technology - does social capital help?

How do rural communities make important decisions about farming techniques? What determines, for example, whether neighbouring households share information and decide to adopt a new technology or not? 'Social assessments' can enhance understanding of such social processes; but at a cost of around US$100,000, are they worth it? At Middlebury College in the United States, analysis of household data from Tanzania suggests that the positive effect of social capital on fertiliser adoption makes a strong case for using social assessments to improve the probability that agricultural households will adopt new technologies.

Technology adoption can dramatically improve the welfare of neighbouring agricultural households in Sub-Saharan Africa. Are ethnically and socially homogeneous households, who communicate often, more likely to share vital information and therefore adopt new technologies? Using data from 23 villages in the Plateau Zone of Tanzania, the analysis shows that:

villages with tribally-based social affiliations are more likely to diffuse new information successfully

households are more likely to adopt fertiliser in villages with tribally-based social affiliations.

To design successful extension programmes that encourage adoption of new technologies, social assessments can usefully:

identify villages that are tribally homogenous or diverse

show how other village characteristics impede the flow of information: for example, inequality that discourages interaction between rich and poor and limits the sharing of public information

provide practitioners with a more complete picture to guide potential investment in extension programs.

This does not mean, however, that investing in extension programs in communities with high ethnic fragmentation should be avoided. Ethnically diverse communities may well be the poorest and in most need of improved agricultural techniques. Where investment is aimed at the poorest villages, support for social structures will be crucial, for example:

strengthening local organisations: for example, through training in new agricultural techniques

follow-up with individual farmers to counteract possible erratic adoption of new technology in ethnically diverse areas.

Contributor(s): Jonathan Isham

Further information:
Jonathan Isham
Department of Economics and Program in Environmental Studies
Middlebury College
Vermont 05753
USA

Tel: +1 (802) 443 3238
Fax: +1 (802) 443-2458
Email: jisham@middlebury.edu

Middlebury College

See Also:
The effect of social capital on technology adoption: evidence from rural Tanzania IRIS Working Paper #235 and presented at the CSAE conference, Oxford, by Jonathan Isham (2000). More information
Can investments in social capital improve local development and environmental outcomes? A cost-benefit framework to assess the policy options by Jonathan Isham in ‘Social Capital, Economic Development and the Environment’ edited by Sunder Ramaswamy, Thomas Kelly, and Jonathan Isham, Edward Elgar Publications (forthcoming).

Other related links:
Search Eldis for sources on social capital

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