[ANALYSIS & FEATURE] Social capital greases the wheels of society

Following is the first in a 10-part series which will shed light on social capital in Korea. - Ed.



By Ko Kyoung-tae



Jin Min-jung, a barista at the Coffee Bean & Tea Leaf, becomes anxious when asked to work with other employees of Coffee Bean franchises at her branch.

"Coworkers and I are concerned about what people are doing and whether they might make mistakes - consciously and unconsciously. It is very nerve-racking," the 23 year-old Seoulite said.

"Even though they had the same job training, learned the same manuals as we did, we are just nervous about them. On the contrary, I have very deep intimacy with my coworkers."

Such exclusiveness does not prevail only on the workplaces in Korea.

Experts point out Koreans place very low credit with business partners, strangers, government offices and even laws.

A recent survey by the Korea Development Institute partly revealed such deep-rooted cultural suspicions.

The state-run think tank found last month that less than one third of the population think their government is reliable, posting 3.3 out of 10 in an index measuring public trust.

Less than 11 percent of respondents said they trust the National Assembly, far below 22.9 percent with U.S. citizens and 18.2 percent with Japanese.

Such a gap in trust stokes not only anxieties with politicians and sociologists but also academic interests from some interdisciplinary economists.

As social confidence is found to be deeply related to social stability and economic growth, they have been trying to conceptualize this intangible but strikingly important social ingredient.

This led to the coining of the new socioeconomic jargon - social capital.

While physical capital refers to tangible assets such as buildings, machineries and cash, social capital largely indicates immaterial assets that arise from trust among individuals.

The neology incorporates a wide variety of social connections so that it may indicate reciprocity between business partners and long-built credit between banks and debtors.

The terminological ambiguity has been seamlessly engendering fresh definitions, but researchers mostly agree that social capital stems from trust and reliability built from positive human relations.

Trust, mutual understanding and shared values and behaviors that bind community members are integral components in the new capital, which makes cooperative action possible in boardrooms, civic groups and even on streets.

In the World Bank`s 1999 survey it defined social capital as, "the institutions, relationships, and norms that shape the quality and quantity of a society`s social interactions."

The basic premise to put social wellness in the category of capital is that it is buttressing major social barometers such as economic growth, the crime rate, health data and educational achievement.

It particularly helps reduce the transaction costs associated with formal mechanisms like contracts, hierarchies, bureaucracies and legal enforcements.

Without a certain amount of social capital or trust between business partners, every contract should seek to specify meticulous clauses in all possible contingencies.

Such wasteful transactions are seen in the labor pacts of auto plants that are as thick as telephone books and pages-long insurance provisions in tiny letters.

Every security brokerage is tape-recording all phone calls from clients to better deal with possible legal complaints.

A lack of social capital drives firms to spend more time and money in preventing unforeseen loopholes.

But companies are not the only payer for plugging the trust gap.

A 24-year-old security guard at a state-run casino, who requested to be identified only with her surname Park, is one of the victims of the trust shortfall.

She had to visit local labor offices over a dozen times just to earn her legal holidays on a year-long contract with a casino security firm.

"The job contract that the company directly gave me was like a kid`s drawing," Park said.

"They scribbled some crude, unclear terms on a white paper without mentioning about off-duty days, working hours and annual leave. The paper was quite different from what I had heard at a job offering."

The low confidence in her employer turned her to consult government labor experts, which was frustratingly time-consuming and raised questions of untrustworthiness.

"I was annoyed by the fact that even subcontractors of the government are not credible. I also lost my trust in the irresponsible labor officials."

What does such low social capital cost her? Foot-aching visits to labor offices, several sleepless nights and low commitment and productivity in her workplace.

Observers are especially concerned that Korea is still suffering from low social confidence despite decades-long rapid industrialization and democratization.

Korea is considered to have the worst labor disputes among major developed economies, and the downtowns of some cities are too often occupied with rallies by interest groups, political protestors and religious associations.

Trustless relations have hampered talks between policymakers and opponents, halting major tunnel and road projects for years.

Volunteering and social contribution are still low compared to Western societies, and civic engagements are mostly out of Korean`s interests.

Experts point out the Korean War and long-standing military dictatorships have prevented citizens from building social capital over the decades.

The three year long war, which had devastated the Korean peninsular from 1950 to 1953, is cited as a main culprit for the trust shortage.

"The postwar days were totally different," said Kim Bong-kook, a 62 year-old retiree.

"Some villages were under the control of the South Korean Army during the day, but of North Korean guerillas at night. Nobody could trust anybody."

The tragedy was followed by military-led regimes which had ruled out fair negotiations, democratic decisions and civil associations for decades.

This caused a two-tier moral system among Koreans, with good behavior reserved for family and personal friends, and a decidedly lower standard of attitudes in the public sphere.

In contrast to the below-average credits on strangers and public agencies, the KDI survey noted Koreans feel more confident in private relations such as those with coworkers and alumni.

"Many groups achieve internal cohesion at the expense of outsiders, who can be treated with suspicion, hostility, or outright hatred," Francis Fukuyama, a renowned U.S. political economist, said in a paper.

Recent statistics and research consistently demonstrates that further social development must be based on attaining higher social capital.

"Social capital allows citizens to resolve collective problems more easily," Robert Putnam, a pioneer political scientist in social capital, said in his popular book "Bowling Alone: The collapse and revival of American community."

"Social capital greases the wheels that allow communities to advance smoothly. Where people are trusting and trustworthy, and where they are subject to repeated interactions with fellow citizens, everyday business and social transactions are less costly."

(kkt@heraldm.com)