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A Simple Complementary Development Mechanics for African Countries

Dinda, Soumyananda (2009): A Simple Complementary Development Mechanics for African Countries.

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This paper provides a simple development mechanism for African nations, where economic development is low due to not only low level of physical capital but also poor social capital that leads to lot of conflicts. The study suggests for development of social capital, which is a broader concept containing the social norms and networks that generate shared understandings, trust and reciprocity, which underpin co-operation and collective action for mutual benefits that creates the base for economic prosperity. Social capital like trust could be accumulated when people interact in a purposeful manner with each other in workplaces, associations and range of informal and formal meeting places. These social activities increase with development of human capital through schooling. Educated individuals are interested in dialogue and conversation, which enables people to build societies, to commit them each other, and thereby to knit the social fabric and allow nation to advance smoothly. This study deals with the building of bridging and linking social capital through human capital formation that is created from productive consumption. This paper develops mechanism through which such social capital forms and contributes to economic growth in endogenous growth framework. Poor African countries can overcome low level equilibrium trap with creating social capital.

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