Social capital and household welfare in South Africa, 1993-98

The aim in this study is to determine the nature of the causal relationship, if any, between 'social capital: as measured by household membership in formal and informal groups and household welfare in South Africa. Using a recently collected panel data set in South Africa's largest province, we estimate per capita expenditure functions including measures of social capital, After-controlling for fixed effects and simultaneity, we find social capital has no effect in 1993 but a positive and significant effect in 1998.