University of Utah

Exploring the Impact of Community and Organizational Social Capital on Government

Performance: Evidence from England
Author(s): Rhys Andrews
Source: Political Research Quarterly, Vol. 64, No. 4 (DECEMBER 2011), pp. 938-949
Published by: Sage Publications, Inc. on behalf of the University of Utah
Stable URL: https://www.jstor.org/stable/23056358
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 Political Research Quarterly
64(4) 938-949
Exploring the Impact of Community © 2011 University of Utah
Reprints and permission:

and Organizational Social Capital sagepub.com/journalsPermissions.nav

DOI: 10.1177/1065912910381649

on Government Performance: http://prq.sagepub.com

(DSAGE
Evidence from England

Rhys Andrews'

Abstract

Civic-republican theories of democracy assume high levels of social capital within the community
bureaucracies will be associated with better government performance. This article tests these assump
the impact of community and organizational social capital on the achievements of English local gov
interdependence between social capital and performance is modeled using a range of primary and s
statistical results suggest that both community and organizational social capital are positively relat
performance. However, further analysis revealed that the combined effects of these two forms of soc
beneficial for performance.

Keywords
social capital, community, organization, government performance

In recent years, political science has contained wide
ranging debate about social capital and government perfor
mance (see Boix and Posner 1998; Putnam 2000; Tavits
2006). Civic-republican theories of democracy suggest
that community organizational life, political engagement,
and trust among citizens create positive externalities for
governments seeking to carry out core bureaucratic tasks
(Putnam 1993, 2000). By enabling citizens to overcome
collective action problems associated with influencing
policy decisions, community social capital can lead to
greater government responsiveness and thereby improved
performance. Moreover, the social capital inherent in the
social relations within an organization can also be regarded
as a potentially critical asset in maximizing bureaucratic
effectiveness (Langbein and Jorstad 2004). Where there
are high levels of collaboration and good will among orga
nization members, governments may be able to reduce
their reliance on cumbersome monitoring procedures,
thereby lowering the transaction costs associated with
leveraging organizational effort and resources (Leana and
Van Buren 1999; Nahapiet and Ghoshal 1998).
a notable exception see Cusack 1999). Moreover, to date,
scant research has explored the impact of community and
organizational social capital on government performance
within the same study, despite the central place of both
aspects in theoretical accounts of the social capital
government performance relationship (see especially Boix
and Posner 1998) and recent suggestions that it is important
to unravel their separate and combined effects (Tavits
2006). Thus, although interest in the social capital-perfor
mance relationship grows apace, a number of important
empirical questions remain underexplored. Is community
or organizational social capital most conducive to better
performance? Are the effects of community and organiza
tional social capital stronger in combination or separately?
By applying a statistical model of community and orga
nizational social capital to the performance of English
local governments, this article advances research on the
relationship between social capital and government perfor
mance by moving beyond the existing focus on the salience
'Cardiff University, Cardiff, UK

A small but growing number of empirical studies have

Corresponding Author:
examined community social capital and government per Rhys Andrews, Cardiff Business School, Cardiff University, Cardiff, UK,
formance (e.g., Knack 2002; Tavits 2006), but almost none CFI0 3EU

have considered the role of organizational social capital (for Email: AndrewsR4@cardiff.ac.uk

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Andrews 939

of community social capital, to examine its impact along

community constitute a large stock of material, cultural, a
side and in combination with organizational social capital.
human resources that can be potentially be mobilized f
The article begins by formalizing the concepts of commucommon communal purposes. One such purpose is t
nity and organizational social capital and deriving hypoth
improvement of government decision making and servi
provision within an area. By drawing on the formal an
eses on their potential impact on performance. Thereafter,
measures of performance and social capital and appropri informal mobilizing social structures present in the comm
ate controls are identified and described, before results of that they serve, governments can tap vital reserves
nity
time and money that can be deployed in pursuit of bett
statistical models of social capital and government perfor
policy formulation and implementation (Montgomery
mance are presented. The article concludes by discussing
the implications of the findings. 2000). Robert Putnam identifies three key dimensions o
community social capital that have played a central role
maintaining the quality of government performance i
Social Capital and Government Italian regions (1993) and the U.S. states (2000): commu
Performance
nity organizational life, engagement with public affairs, an
Numerous alternative approaches to conceptualizing and
interpersonal trust. Each of these dimensions of communit
operationalizing social capital have been advanced by
social capital incorporates bonding and bridging aspects
social capital
social scientists (see Portes 1998). Central to the concept is and is likely to have important independen
and can
the notion that a community's relational resources combined
be positive effects on the structural and attitu
harnessed by certain actors to achieve desired nal resources available within communities for government
outcomes
(Bourdieu 1980). As such, social capital is a powerful
to harness in the pursuit of service improvement.
In the
shared resource that potentially can be directed toward thepresence of community organizational life, cit
achievement of collective goals. In addition to zens maya be increasingly able to overcome collecti
being
"jointly owned" resource, social capital is characterized problems
action by associated with monitoring and influ
encing government. In particular, community-bas
distinctive bonding (exclusive) and bridging (inclusive)
organizations
aspects, which may reinforce exclusive identities or encom may raise political awareness (Claibour
and Martin 2007), and moderate political attitudes
pass myriad diverse ones, typically (though not necessarily;
see Portes 1998) in ways that are conducive to the diverse group members are required to collaborate
public
good (Putnam 2000). While some scholars have sharedfocusedprojects (Cigler and Joslyn 2002). This may, in
exclusively on the bridging aspects of interactionsturn, enable citizens to articulate their political demand
connect
with Burt
ing diverse actors as the source of social capital (e.g., greater force (Leroux 2007) and make it mor
1997), others emphasize the bonding nature of the straightforward
shared for governments to meet their needs
values that underpin such interactions (e.g., (Elkins
Colemanand Simeon 1979). Community-based organi
tions
1994). Broadly speaking, social capital therefore might also supplement, substitute, or support pub
encom
lic agencies,
passes "social networks and the norms of reciprocity and thus generating positive externalities for
them by lowering their costs while simultaneous
trustworthiness that arise from them" (Putnam 2000,19).
increasing
For large public bureaucracies, the social capital pres their capacity (Putnam 1993, 2000). For
instance,
ent within the communities that they serve as well as that community-based organizations often develo
found among their leaders and members is likely particular
to create expertise in addressing complex economi
environmental,
distinctive positive externalities for organizational effec and cultural problems at the neighbor
hood
tiveness. Indeed, theoretical perspectives on social level (Florin and Wandersman 1990). They ma
capital
also "better provide for niche segments of the target p
and government performance assume that the relational
ulation
resources of citizens is a prime source of public containing few clients with specialized need
service
improvement but also acknowledge the value of(Wallis
the sameand Dollery 2006, 493).
resources among bureaucrats (see Boix and PosnerPublic
1998).organizations require the support of multiple
Thus, the social capital available to governmentsexternal
takes anstakeholders, especially local citizens and s
vice users (Hirschman 1970). The active interest of loc
external community-based and internal organizational
based form, each of which may have a distinctive people in public affairs is therefore likely to exert an
though
potentially complementary effect on performance. important influence on government performance. In p
ticular, the potential for governments to respond eff
tively to policy problems and challenges may be enhanc
Community Social Capital and where citizens are more public spirited and engaged in
Performance public affairs and political decision making (Putna
1993). Almost half a century ago, Almond and Ver
According to Coleman (1988), the networks of relationships
(1963) found that a cultural legacy of civic engagemen
between the residents living within any given geographical

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 940 Political Research Quarterly 64(4)

had a positive effect theories

on theassumequality
that positive relationships
of governm among organ
United Kingdom and the
zation United
members are essential forStates. An
knowledge transfer an
zenry can set policy agendas
creation to occur asor constrain
effectively the
as possible. Nahapiet and
alternatives available to
Ghoshal policy
(1998) argue that theremakers (E
are three key interrelate
Simeon 1979). Engaged,
aspectsactive citizens
of the social relations aremembers
among organization als
more likely to view themselves as of
that may enable the unlocking aideas
collection
and information th
equals and to therefore feel influence
can positively an obligation to
organizational outcomes: p
struc
public good (Rice and tural
Feldman 1997).
(connections among This
actors), relational (trust sug
amon
high commitment to actors), and cognitive (shared
democratic goals and values
politics, as amon
e
electoral participation,actors;
may Nahapiet and Ghoshal 1998).
bolster theEach legitim
of these facet
lic organizations as well as make
of organizational it constitutes
social capital easier to
collectivel
vices to the needs of users.
owned "assets" that facilitate "some forms of social
Governments can effectively
action while inhibiting promote
others" (Nahapiet andand
Ghoshal m
public goods, such as 1998,
quality
245). of life and envi
well-being, only where there
Structural is is"cooperation
social capital constituted by the "configu
among local people (Wilson
rations of linkages 1997). Ifunits"
between people and such
(Nahapiet s
missing, governments andare
Ghoshallikely
1998, 244). Such
to connections
face between
consi
lenges in their attempts to distribute
actors provide opportunities for them services
to gain access to
different social groups. The amount
relevant peers with of behavi
desired sets of knowledge or exper
required for compliance tise. Frequent
with interactions
societal between organization
laws and mem
may be reduced where there
bers in is strong
different functional social
areas and departments, for
instills a sense of social connectedness and decreases the example, are likely to positively influence the speed with
likelihood of antisocial behavior (Mazmanian and Sabatier which organizational learning can occur (Kogut and
1989). Such trust can also lower transaction costs within Zander 1996). Miller (1992) argues that repeated suc
civil society, creating stronger incentives for the expansion cessful bilateral interaction between agents increases
of community organizational life (Fukuyama 1995). This cooperation rates, which, in turn, can have a beneficial
may make it easier to improve the provision of public ser influence on organizational performance. Formal and
vices through increased funding and partnerships between informal processes of collaboration and coordination
local communities, voluntary associations and the private within organizations create networks of relationships
sector (Purdue 2001). In turn, governments may require which senior managers can mobilize for the benefit of
fewer resources to mediate local demands and maintain organizational outcomes (J. Scott 1999). Interaction
good community relations. between different departments within an organization can
Although the existence (and direction) of a causal enable leaders to garner knowledge "spillovers" to accom
mechanism between community social capital and govern plish collective goals or obtain scarce resources (Willem
ment performance has been questioned (see especially and Scarborough 2006).
Jackman and Miller 1998), prior studies find that the Relational social capital refers to the underlying reci
aggregated effect of the different elements of community procity that guides exchanges between organization
social capital positively influences management quality members. High levels of trust between organizational
in governments (e.g., Coffe and Geys 2005; Knack leaders and members in particular may permit the trans
2002). Thus, it is anticipated that fer of sensitive information, foster collaborative action
in the absence of formal mechanisms for that purpose
Hypothesis 1: Community social capital will be (Coleman 1988), and diminish resistance to organiza
positively related to government performance. tional change (Kramer 1999). Resources previously
assigned to monitoring employees can be redirected else
where if the "expectation among the multiple layers in a
Organizational Social Capital large firm that cooperative behaviour will be met in kind"
and Performance
is fulfilled (Miller 1992,197). Although strong intraorga
Organizational theory provides a fruitful lens through
nizational relational ties may increase the prospect for
which the potential benefits of the relational resources
negative externalities associated with closure to emerge,
within government bureaucracies can be understood. such as "groupthink" (Adler and Kwon 2002), trust can
Knowledge-based theories of the firm suggest that orga organizational commitment, which can in turn
increase
nizations are best viewed as "a social community special
lead to better outcomes (Langbein 2000).
izing in speed and efficiency in the creation and transfer
Finally, cognitive social capital is constituted by the
of knowledge" (Kogut and Zander 1996, 503). These
broader organizational mission and values that form the

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Andrews 941

context in which collective action take place. If organiza Research Context, Data, and Method
tion members share and pursue a common strategic vision
and goals, this may promote both integration and collec The panel data set for the analysis consists of a maximum of
tive responsibility (Coleman 1990). Shared interpreta142 English single and upper tier local governments (county
tions of the values and mission of the organization furnishcouncils, London boroughs, metropolitan districts, and uni
cognitive "templates for particular types of actors"tary authorities). These governments are elected bodies,
(W. Scott 2001, p. 58), which may enable them to cope with a Westminster-style cabinet system of political man
with environmental uncertainty, potentially creating posiagement, which is usually made up of senior members of the
tive externalities for organizational performance. The ruling political party. The politicians collectively decide
"willingness and ability to define collective goals that arepolicy on the basis of advice and guidance from professional
then enacted collectively" (Leana and Van Buren 1999, local government managers. The local governments operate
542) is thus associated with greater overall synchronizawithin statutorily defined geographical areas and receive
tion of organizational effort. This is especially importantapproximately two-thirds of their income from U.K. central
in large organizations as leaders need to communicate government. They are large multipurpose governments pro
with, and motivate, myriad diverse groups of employeesviding a range of public services, including education, social
to achieve desired goals (Selznick 1957). care, environmental services, housing, welfare benefits, and
Although each dimension of organizational social leisure and cultural services.
capital may have distinctive effects (see especially
Jackman and Miller 1998), they are invariably highly
Dependent Variable
correlated (Tsai and Ghoshal 1998). Indeed, their com
bined effect has been shown to positively influenceGovernments are typically required to meet multiple and
public school performance (Leana and Pil 2006), leading potentially conflicting organizational goals (Rainey
to the following expectation: 1993). Moreover, their achievements are judged by a
diverse array of constituencies, such as taxpayers, staff,
Hypothesis 2: Organizational social capital will be and politicians. The criteria, weighting, and interpreta
positively related to government performance. tion of performance indicators are thus all subject to
ongoing debate and contestation among key stakeholders
While community and organizational social capital(Boyne 2003). Accordingly, the analysis presented here
may be expected to have important separate effects onfocuses on the views of the primary external stakeholder
government performance, it is likely that in tandem they on the service performance of English local governments:
enhance bureaucratic effectiveness still further. Lowndes,U.K. central government.
Pratchett, and Stoker (2006) highlight that the most In England, central government performance classifica
responsive local governments are those that are able to tions are important (though contestable) means for assess
establish a political opportunity structure in whiching the achievements of local governments. Central
bureaucrats, politicians, and citizens are all willing and government provides the majority of their funding and
able to contribute toward common goals. Strong commu monitors administrative accountability on behalf of citi
nity social capital can help relieve public authorities of zens. In recent years the principal assessment of English
the "burden of enforcing compliance" with legislation, local government performance carried out by central gov
increasing their ability to marshal their organizational ernment inspectors was the annual Comprehensive Perfor
social capital toward the provision of better servicesmance Assessment conducted by the Audit Commission (a
(Boix and Posner 1998). At the same time, strong organi central regulatory agency). For four years during the period
zational capital can enable bureaucrats to devote more covered by this analysis (2002-5), this classified the per
resources to community development by providing supformance of local governments by making judgments
port for a multitude of valuable activities and organiza about their achievements in six key service areas (educa
tions (Lowndes, Pratchett, and Stoker 2006). Thus, tion, social care, environment, housing, libraries, and lei
cohesive communities and cohesive bureaucracies may sure and benefits) together with their broader "management
continually reinforce the positive externalities associatedof resources" (Audit Commission 2002). A local govern
with each. The emergence of this virtuous cycle leads toment function regarded as "excellent" could benefit from
the final hypothesis: "lighter touch" inspections and freedom from some central
controls. By contrast, those classified as "poor" could be
Hypothesis 3: The positive impact of community externalized, new management imposed, or stricter regula
social capital on government performance will tion introduced (Downe and Martin 2007).
be strengthened by organizational social capital, Each service area was given a score from 1 (lowest) to 4
and vice versa. (highest), based on achievements on "objective" statutory

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942 Political Research Quarterly 64(4)

performance Table
indicators thatI.are
Community and O
independently
checked for accuracy. The Audit
Characteristic Commission
Factor loading th
the service scores to reflect the relative budget of
Community social capital
area (children and young people
Community andlife
organizational adult
.71 soci
environment and housing = 2, with
Engagement libraries
public affairs and
.66 leisur
and management of resources - 1). .83
Social trust The weigh
Eigenvalue
were summed to provide 1.62
an overall service p
judgment, ranging Percentage
from 15 (12variance 54.12
for county coun
not provide housing orOrganizational
benefits socialservices)
capital to
Structural
county councils). Because these social capital are
scores .68 not d
Relational social capital .85
parable across all types of authority, for this an
Cognitive social capital .86
government's score is taken as a percentage o
Eigenvalue 1.93
mum possible score. By providing
Percentage variance an overall j
64.30
the achievements of local governments, the
performance score therefore represents a goo
their overall effectiveness.

To explore the possibility

Following that
Putnamperformance
(2000) and others
measure may reflect the
adherence to of
relative influence the Labour
political partic
government's policyitalagendas
was measured during theinst
as the turnout En
rather than substantive
ment achievements,
elections. High turnout the
impliesing
variables were also regressed
public affairsonandtoactive
excess
engagement
gov
spending (see Revelli 2010).
good" This
(Smith 2002). measure
The measure is ther
lated as the ratio of actual expenditure
for political toabsence
participation in the spe
as determined by theattitudes
central towardtoengagement
local governwith pub
allocation formula
(known
English local as the Standard
governments.
Assessment) originallyAdevised under
proxy for social trustthe Con
was measu
government in the 1980s. Both
rate of criminal social
damage capit
offences rec
were associated with statistically
sand capita withinsignificant
the areas served bl
ment. Crime
of excess spending, thereby rates have
adding been used
further coi
the findings presented below
studies (results
as proxies shown
for the level of tru
in the supplementary ties
materials).
(e.g., Coffe and Geys 2005; Rice a
The rate of criminal damage is a parti
tor of the level of social trust since it r
Independent Variables
or reckless destruction or damage t
property.
Community social capital. A The relative gauging
measure prevalence
of community social behavior
capital within
will theinformal
likely reflect areas
English local governments was
appropriate created
conduct by ag
toward fellow citi
separate measures of community
(Gibbs organiza
1977). The principal componen
political engagement, create
and theinterpersonal
aggregate communitytrust.
socia
is the shown
equivalent of that in Table
used by 1. The table shows
Coffe and that
Ge
their study of social capital and
on to a single financial
factor man
accounting for ove
Belgian municipal governments.
variance and that the factor loadings
therefore life
Community organizational important determinant
in local gove
areas was measured as explained
the number
(Hair et al. of commun
1998).
and personal services organizations
Organizational social(e.g.,
capital. volu
Data
ciations, film societies, or sports clubs) per on
organizational social capital were deri
capita registering for of
value
managersadded (orlocal
in English goods an
governm
tax. Because of their legal status, these organi
series of organizational issues carried
fromof
likely persistent features 2001 to 2004. Data were
community collecte
life. Al
measure is therefore a broad
middle managersproxy
as researchfor as
indicates
activity, data on informal social
between these networks
hierarchical (e.
levels (see W
ties among lower income groups;
2004). The data weresee Stack
aggregated by 19cr
readily available. for the senior managers and middle m

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Andrews 943

government, adding these two scores together, and divid performance. Two proxy measures for the prosperity of
ing them by two to provide an organizational-level mean. local residents were used in the analysis. The first was the
In each participating organization, questionnaires were Average Ward Score on the Index of Multiple Deprivation
sent to at least three senior and four middle managers. In (Department of Environment, Transport and Regions
2001, the total sample consisted of 121 organizations, 2000) was used as a measure of the quantity of service
with a 56 percent (1,259) informant response rate. In needs. This deprivation score is the standard population
2002 and 2003, the total sample was 77, with response weighted measure of deprivation used by U.K. central
rates of 65 percent (922) and 56 percent (790), respec government. It provides an overview of the different
tively. In 2004, the total sample was 136, with a response domains of deprivation (e.g., income, employment, and
rate of 54 percent (1,052).1 Thus, the average number of health). The second was the percentage population
respondents per local government during the study period growth in each local authority recorded in the 2001 cen
was 10.1. Time-trend tests for nonrespondent bias sus. New residents in areas with growing populations are
(J. Armstrong and Overton 1977) revealed no significant likely to be economically skilled and socially enterpris
differences in the views of early and late respondents. ing, thereby generating positive externalities for local
The structural dimension of organizational social cap authorities (H. Armstrong and Taylor 2000).
ital was gauged by asking informants to score on 7-point Three dimensions of diversity of service need are mea
scales ranging from 1 (disagree with the proposed state sured: age, ethnicity, and social class. The proportions of
ment) to 7 {agree with the proposed statement) the extent the various subgroups within each of the different catego
to which "coordination and joint-working" and "cross ries identified by the 2001 national census within a local
departmental and cross-cutting working" were important government's jurisdiction (e.g., ages 0—4, Black African,
within their organizations. These measures represent a large employers, and higher managerial occupations) was
reasonable proxy for the frequency with which actors are squared and the sum of these squares subtracted from
likely to have interacted across functional boundaries 10,000. The resulting measures are akin to the Hehrfindahl
(see Langbein and Jorstad 2004). Informants were asked indices economists use to measure market "fractionaliza
whether "there is a high level of trust between top tion," with a high score on the index reflecting a high
management and staff' and if "there is a high level of level of diversity (see Trawick and Howsen 2006)—and
trust between top-management and politicians" to assess therefore a greater challenge for local governments.
the relational dimension of social capital. These survey Organizations serving big populations can accrue
items were developed from those utilized in Cusack's economies of scale by distributing fixed costs over more
(1999) study of organizational social capital and local units of output (Boyne 2003). The relative size of local
government performance. The cognitive dimension of governments was measured using population estimates
social capital was evaluated by enquiring about the extent for each local area. Public organizations in densely popu
to which the local government's "mission, values and lated areas can reap scope economies by offering multi
objectives are clearly and widely owned and understood ple services from the same site (Grosskopf and Yaisawamg
by all staff' and the extent to which the organization con 1990). Population figures were therefore divided by the
centrated on achieving its "mission, values and objec area served by each local government to measure density.
tives." These measures are based on those Tsai and Potential urban agglomeration effects, such as access to
Ghoshal (1998) use to gauge the extent to which a visionbetter capital goods or labor, were further controlled
is both shared and pursued within an organization. The through the inclusion of a dichotomous variable coded 1
for those local governments classified as urban by U.K.
combination of each of the three dimensions into a single
organizational social capital index using principal com central government (see Office of the Deputy Prime Min
ister 2002) and 0 for those classified as rural.
ponents analysis is shown in Table 1 (full descriptions for
the survey items can be found in Table 2S in the suppleGovernment expenditure and, therefore, performance
mentary materials). may vary because of local political preferences (Sharpe
The table highlights that the measures load on to and
a Newton 1984). The percentage Labour Party vote
single factor accounting for 60 percent of the varianceshare
in in the most recent local election was therefore
included as a progovernment measure among local
the data. Again, all the factor loadings are over 0.5, signi
residents. The potential influence of mayoral power on
fying that they are important determinants of the variance
explained. performance (see Tavits 2006) was captured by includ
ing a dichotomous variable for those English local
governments with an elected mayor and 0 for those
Control Variables
without. Local governments with high levels of finan
cial resource capacity can potentially pay their way to
Eleven measures were selected to control for the poten
success by investing in better-quality staff or new
tial impact of other relevant variables on government

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 Political Research Quarterly 64(4)

Table 2. Community and Organizational Social Capital and Performance

Independent variables Slope Slope Slope

Community social capital (CSC) 1.988* (1.139) 6.543* (3.545)

Organizational social capital (OSC) 2.221** (0.389) 6.813* (3.413)
Interaction
CSC x OSC -0.468 (0.346)
Control variables

Deprivation -0.163* (0.084) -0.090 (0.085) -0.097 (0.085)

Population growth 2.168** (0.898) 1.194** (1.475) 1.927** (0.831)
Age diversity -0.0003 (0.014) 0.010 (0.014) 0.009 (0.014)
Ethnic diversity -0.001* (0.0006) -0.001* (0.0006) -0.001* (0.0006)
Social class diversity -0.012 (0.014) -0.010 (0.013) -0.010 (0.013)
Population (log) 1.454 (1.602) 1.194 (1.475) 1.283 (1.477)
Population density (log) 0.658 (1.177) 0.577 (1.082) 0.604 (1.083)
Urban 1.356 (3.299) 3.9607 (3.187) 3.844 (3.189)
Elected mayor 3.215 (2.682) 2.954 (2.581) 2.731 (2.583)
Labour vote share -0.023 (0.060) -0.020 (0.059) -0.022 (0.059)
Service expenditure per capita 0.006* (0.003) 0.005+ (0.003) 0.005+ (0.003)
Wald x2 77.04** 119.19** 121.26**
Overall R2 .151 .258 .262
N of observations 397 397 397

Note: Directional hypotheses were evaluated with a one-tailed test, nondirectional hypotheses with a two-tailed test. Standard errors are in
parentheses. Dummy variables for individual years are not reported.
< . 10. *p < .05. <.01.

methods of working (Boyne 2003). Potential spendingcommunity and organizational social capital are added
effects were controlled by using revenue expenditure fig separately and in combination. The table highlights that
ures per capita (the descriptive statistics for all the mea the control variables account for about 15 percent of the
sures used in the multivariate analysis can be found in variation in the performance of this sample of govern
Table 3S in the supplementary materials).2 ments. All the control variables, except Labour vote
share, have the expected signs, and some are statistically
significant. Performance appears to be positively influ
Statistical Results
enced by prosperity and service expenditure and nega
A Lagrange multiplier test rejected the null hypothesis
tively influenced by ethnic diversity.
that the intercepts for the sample governments are Akaike
the information criteria (AIC) and an F test
same. Generalized least squares regression with random
revealed that inclusion of the measures of social capital
effects estimations was used since it can accommodate makes a statistically significant improvement to the
varying intercepts and controls for the effects of time cor
explanatory power of the model of over 10 percent. In
relation, panel heteroscedasticity, and within-panel auto
addition, the first two hypotheses on the relationship
correlation (Beck and Katz 1995,637). Some cases could between social capital and government performance are
not be matched when the survey variables and perforsupported: the coefficients for community and organiza
mance measures were mapped because of survey attrition tional social capital are both positive and statistically sig
and missing data within the respective data sets. The sta
nificant. A joint Ftest revealed that despite organizational
tistical analysis of the relationship between social capital
social capital having the stronger statistical effect within
and performance was therefore conducted on a panel of the model, its positive influence was statistically indistin
120 governments in 2001, 76 in 2002, 73 in 2003, and
guishable from that of community social capital, thereby
128 in 2004. The data for this sample are homoscedastic,suggesting that gains and losses in the stocks of either
so no additional controls for nonconstant error varianceform of social capital may be likely to have important
were required. The average variance inflation factor consequences for government performance.3
score for the independent variables is about 3.6, indicat AIC and an F test showed that the inclusion of the
ing that the results are not distorted by multicollinearity
interaction between community and organizational social
(Bowerman and O'Connell 1990). capital does not make a statistically significant addition
Table 2 presents the relationship between the con
to the model's explanatory power.4 However, although
trol variables and performance before the measures of
the interacted term itself does not quite reach statistical

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Andrews

Figure I. Marginal impact of community social capital on performance contingent on organizational social capital

significance, it is actually negative—the opposite of what social capital (9 for the interaction model). These findings
was expected. To fully explore interaction effects it is suggest that any combined benefits accruing to local gov
necessary to calculate the marginal effects on perfor ernments high in both forms of social capital are not being
mance of varying levels of the moderator variable (see realized in terms of better performance.
Brambor, Clark, and Golder 2006). Graphing the slope It is conceivable that gains associated with strength in
and confidence intervals of the marginal effects is the one form of social capital are offset by strength in the
most effective way to present this information. Accord other, perhaps because of the transaction costs associated
ingly, Figure 1 provides a graphical illustration of the with bringing together highly cohesive social groupings
moderating influence of organizational social capital on in pursuit of better outcomes. The quest for goal congru
the relationship between community social capital and ence between local governments and their citizens is
performance. Figure 2 illustrates the moderating effect of inevitably beset with collective action problems, what
community social capital on the relationship between ever the degree of community and organizational social
organizational social capital and performance. capital brought to bear on their resolution. However, if
Figure 1 suggests that the relative degree of organiza both governments and citizens exhibit strong group cohe
tional social capital is likely to have an important moderat sion, then it is possible that such problems become more
ing effect on the relationship between community social intractable. While governments serving areas high in
capital and government performance. In particular, as orga community social capital may be fully cognizant of citi
nizational social capital rises from its minimum level (6.32 zens' priorities, it could be more difficult to address these
for the interaction model) the beneficial effects of commu priorities if public servants have the collective resources
nity social capital decrease, though they remain positive to resist any perceived threats to their professional auton
until nearly two standard deviations above the mean level of omy. Lowndes, Pratchett, and Stoker (2006) illustrate
organizational social capital for this sample of governments. how highly active citizens were unable to influence an
At this point, the positive effect of community social capital English local government with a strong bureaucratic
becomes statistically insignificant. Figure 2 illustrates a sim ethos, while several studies point to worse student perfor
ilar pattern. As community social capital rises the positive mance in highly unionized public schools in the United
effect of organizational social capital becomes statistically States (e.g., Moe 2009; Hoxby 1996).
insignificant, though in this case much earlier, at about 1 At the same time, governments benefiting from high
standard deviation below the mean level of community levels of organizational social capital may find it difficult

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 Political Research Quarterly 64(4)

I I I

5 10 15

Community Social

Figure 2. Marginal impact of org

to overcome social capital are therefore not

strong eliciting anticipated a
collecti
policy change tional
amongperformance gains. the citiz
and Crook (2008)The statistical
findresults imply that
thatgovernments seeki
th
agement to enhance effectiveness
Agency, a through support for
public org social c
very tal should prioritize
strong
sense of the development
mission, of one or the ot
to site form of social capital.
new
trailer parks There is some evidence
in that th app
by politically priate
activehuman resource management
local initiatives
resi can co
French agriculture policy
tribute to greater trust by
between leaders and members
strong may also
political andindependently lead to better performa
bureaucra
been circumvented by
(Gould-Williams 2003). Community socialhigh
capital too h
(Roederer-Rynning 2007).
performance payoff, which can be harnessed to Fu
governm
tative effectiveness in several of
investigation ways. For example,
the some re
gove
and ment-led initiatives,
governments in such areas
as promoting understandin
hig
capital would unravel the
democratic citizenship, may lead dyn
to better performance
community Andrews, Cowell,
and and Downe 2008). Grassroots comm
organization
nity involvement that increases social capital may also
the focus of public policy (Harris and Young 2009). H
Conclusion
ever, the interactions presented in Figures 1 and 2 Tab
This article expands on existing quantitative studies by that governments may encounter difficult tra
highlight
systematically exploring the separate and combined offs between community and organizational developm
impact
of community and organizational social capital onwhengovern
weighing the relative merits of different approaches
ment performance. The findings indicated, as expected,
improving performance.
Effective
that both forms of social capital are positively related to responses to these questions will refl
performance, even when controlling for other relevant
judgments about existing levels of social capital with
variables.5 However, when taken in combination, thehighcommunity
lev and the organization and the particu
els of one form of social capital appear to cancel challenges
out any that each form of social capital may be sui
gains attributable to the others. Governments with to addressing. For example, while community social
simulta
neously high levels of community and organizationalital is arguably likely to support the growth of mor

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Andrews 947

effects (Gelfland, Erez, and Aycan 2007). All of these

responsive and innovative policies (Tavits 2006), organi
themes merit extended consideration.
zational social capital may more likely to enhance admin
istrative efficiency through its facility for reducing
In conclusion, the findings of this study suggest that gov
transaction costs associated with coordinating govern
ernments seeking to harness the benefits of social capital for
ment action (Boix and Posner 1998). Comparison of thetheir performance may face important trade-offs between
effectiveness of alternative approaches to building social
fully realizing the positive effects of community and organi
capital could reveal which policy levers should be pulled
zational social capital by developing one at the expense of
and when. the other. Studies that therefore seek to compare and contrast
Although the statistical findings reveal the positive the impact of alternative approaches to community and
influence of social capital, the study has clear limitations. organizational development on government performance
The analysis presented here does not explicitly set out to within the same research design would furnish vital clues to
model the potentially damaging effects of social capital help solve this important puzzle.
for government performance. The possibility that the
positive effects of both community and organizational Declaration of Conflicting Interests
social capital may eventually turn negative as cohesive The authors declared no potential conflicts of interests with
ness become exclusionary or increases rigidity (Adler respect to the authorship and/or publication of this article.
and Kwon 2002) was tested by including quadratic terms
in the second model shown in Table 2. However, this did
Financial Disclosure/Funding
The authors received no financial support for the research and/
not add any explanatory power to the model.
or authorship of this article.
This analysis has examined a particular group of local
governments during a specific time period. The findings
Notes
for the core service performance measures may reflect
1. Mests on the control variables for included or omitted g
the ability of local governments to harness social capital
ernments revealed no statistically significant difference
in ways that anticipated central government's demands at
between the sample and population. This indicates that the
that time. It would therefore be important to identify
sample of English local governments is a representative one
whether the relative importance of social capital differs
2. Before running the statistical models, skewness tests we
across several consecutive national governments as well carried out to establish whether each independent variable
as in other organizational settings.6 Further research in was distributed normally. High skew test results for popu
other developed countries could cast light on the com lation (1.93) and population density (1.81) indicated no
parative generalizability of the results presented here. For normal distributions. To correct for positive skew, logged
example, Scandinavian countries are sometimes claimed versions of these variables were created.

to exhibit especially high levels of community social 3. There is no correlation between the measures of communit

capital (Rothstein 2001), while European postcommunist and organizational social capital. Thus, improvements on
and Latin American countries also exhibit very distinc one may not lead to improvements in the other.
4. Ten was added to the community and organizational soc
tive civil society-government relations (Valkov 2009). At
capital measures to ensure that two positive scores wer
the same time, much of the pioneering work on commu
combined when they were interacted.
nity social capital and performance has been carried out 5. Rerunning the model using the six separate indicators of eac
at the state rather than the local level (e.g., Knack 2002). dimension of community and organizational social capital r
The community social capital extant within the areas veals similar results. The sign for each of the social capital co
served by English local governments may be unrepresen efficients is in the expected direction, and five of the indicators
tative of that found in governments operating in other have a statistically significant influence on performance.
countries or at other spatial scales. 6. The author is grateful to an anonymous reviewer for th
The organizational social capital present within gov insight.

ernments may also reflect the strength of the professional References

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