Abstract
This paper draws on ethnographic research in Hong Kong to question the effectiveness of Elinor Ostrom's `design principles' in providing solutions to social divisions by social capital building and institutionalised participation. It challenges the strategic and instrumental assumptions of human motivations for not adequately considering moral concerns, a sense of commitment and the right way of doing things in social cooperation. The tendency to formalise the process of participation, by authority building, rule enforcement and threat of sanction, plays down the role of informal institutions in mediating modes of interactions. The practices of good governance can undermine the already-limited social capital of poor people. This paper concludes by offering the `agency—institutions—structures' framework in analysing social capital.
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