Social Capital, Member Participation, and Cooperative Performance: Evidence from China's Zhejiang

Despite the position of farmer cooperatives in markets and their social capital based characteristics, neither the definition nor the role of social capital in farmer cooperatives has been broadly investigated. Thus, this study seeks to develop a framework for defining and clarifying various aspects of social capital and examines the effects of social capital on members' participation in collective activities and on the economic performance of farmer cooperatives. Social capital is indicated in terms of three dimensions, i.e., the external, relational, and cognitive dimensions. A statistical model is applied to a database consisting of 147 farmer cooperatives in China's Zhejiang province. The results demonstrate a positive relationship between certain dimensions of social capital and members' participation in training and general meetings. In addition, each dimension of social capital has a significant and positive impact on the economic performance of cooperatives.