Human and Social Capital

As of 2013 the United Kingdom’s human capital ranks 8th globally according to the World Economic Forum, “Human Capital Index” annually ratings. The 2013 HCI also ranks UK 8th in terms of primary education enrollment percentage rank (Zahidi, Bloom, Milligan, Guzzo, & Harding, 2014, p. 516). The Human Capital Index functions by evaluating four pillars, these are education, health and wellness, workforce and employment, and enabling environment. The UK ranks first in “water, sanitation, and hygiene” under the second pillar (health and wellness), fourth in the country’s capacity to attract talent (workforce and employment) and sixth in the “Doing Business” index, a component of enabling environment (Zahidi et al. 2014, p. 516-17). The Doing Business index measures how easy it is to start a business and to run that business, as well as the capacity of the business to work across national frontiers (World Bank Group 2014). The Human Capital index also measures additional indicators broken down into demographics, education, health, society, and workforce. Of these, society is particularly of note, as the UK ranks high in the category of “Freedom in the World”—first, in fact (Zahidi et al. 2004, p. 517).

Rosalyn Harper and Maryanne Kelly provide an operational definition for social capital in their article “Measuring Social Capital in the United Kingdom.” According to Harper and Kelly, networks are central to social capital. As such, they describe three forms of networking.

Bonding, Bridging, and Linking, to better analyze the operation of social capital in a country such as the UK. Bonding social capital describes connections among family members or close friends, necessary for “getting by in life” (Harper & Kelly 2003, p. 3). Bridging social capital describes more distant connections, i.e. between business associates or acquaintances. Finally, Linking social capital describes relations between those within a hierarchy—this form of social capital is crucial for “accessing support from formal institutions” (Harper et al. 2003, p. 3). Critical to the analysis of social capital, then, are the levels of trust, membership, and networks of a country (Office of National Statistics). The Legatum prosperity index measures overall prosperity according to factors such as social capital and opportunities for entrepreneurship. The United Kingdom ranks 16th overall and 12th in social capital (Legatum Institute, 2013). The UK ranks especially high in terms of Bonding and Linking social capital, as evidenced by relatively high positive response rates to questions such as “Can you rely on friends and family for help?” and “Have you donated money to charity in the past month?”

References

Doing Business in United Kingdom - World Bank Group. (n.d.). Doing Business in United Kingdom - World Bank Group. Retrieved March 24, 2014, from http://www.doingbusiness.org/data/exploreeconomies/united-kingdom

Harper, R., & Kelly, M. (2003). Measuring Social Capital in the United Kingdom. Office for national statistics, n/a, 1-23.

The HumanCapital Report 2013 - The World Economic Forum. (n.d.). The World Economic Forum. Retrieved March 24, 2014, from http://reports.weforum.org/human-capital-index-2013/

United Kingdom. (n.d.). Prosperity Index 2013. Retrieved March 24, 2014, from http://www.prosperity.com/#!/country/GBR