Understanding and Measuring the Role of Investors' Social Capital Level in the Development Process: A Case Study from Turkey

Abstract

Social capital plays a crucial role in the development processes of every country. Diyarbakir, a metropolitan city in Turkey, and her hinterland had always been – and still is – one of the most developed centers of Anatolia and Middle East. But the city is experiencing a continual relapse more than a century, despite the unique social capital inheritance. Within this context, a survey was prepared to probe this issue from a different perspective and was conducted to a group comprising the city’s main 500 investors for identifying their actual social capital level. Multiple Regression Analysis was implemented to the questionnaire data ranged within Likert scale. Results of the analysis indicated that an increase of 1 unit in networks, trust and norms variables led to an increase of 0,246089, 0,305418 and 0,448925 units in social capital respectively. This finding is contrary to the pre–estimations, which envisaged norms to be the least effective factor among other components.Keywords: Economic Development; Social Capital; Investment; Regional Economics; Multiple Regression Analysis. JEL Classifications: C51; E22; L26; O16; P25; R11