Does social capital help the poor? - a synthesis of findings from the local level institutions studies in Bolivia, Burkina Faso, and Indonesia

Abstract

The Local Level Institutions Study (LLIS) was designed to investigate more systematically, the role of local associations in the provision of services to households, and to examine the extent to which such associations help households, especially the poor, increase their welfare. This paper provides a synthesis of the main findings for the three countries studied: Bolivia, Burkina Faso, and Indonesia, and briefly describes the data collection of the study, discusses the density of local associational life in the three countries, and the main characteristics of associations, and, summarizes the findings of the impact of local associations on household welfare, and poverty. Evidence is provided on the role of associations in the accumulation of assets, access to credit, and the organization of collective action. A major finding documented by the quantitative studies, demonstrates that the composition of membership makes a big difference in the results of the association. Specifically, heterogeneous associations bestow larger benefits on their members, than do less diversified ones, and, by and large, the key dimensions were the economic characteristics of the members, such as education, economic status, and occupation. The authors wish to reiterate that the micro-institutional focus on local associations, pertains to only one component of social capital, its much broader concept, also relates to the macro level, and thus, further analysis will have to pay attention to the interaction between social capital at the micro, and macro levels.

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