Abstract
The social economy holds promise for rural community development through local capacity building, improving political engagement, expanding networks, and increasing productivity by reducing transactions costs. In this study, the contribution of co-op membership to rural community population growth is estimated, along with standard growth determinants. With minor exceptions, the results do not support the expectation that co-ops improve the population growth prospects of rural communities. Currency (or obsolescence) of this particular type of social capital may be a factor. Alternatively, social capital in the form of co-ops may be serving as a substitute for private sector enterprise or other forms of social capital.
Highlights
Long-term trends including labor-saving technical change, globalization and urbanization have tended to disadvantage many Canadian rural communities in terms of population growth (Bollman and Mendelson, 1998; Agriculture and Agri-Food Canada, 2002; Rothwell et al, 2002)
To the extent that co-op membership represents a community's social capital, these results do not reveal a positive influence of social capital on community population growth
Trust, and networks that characterize social capital and that are consistent with the development of co-operatives may be expected to make rural communities more attractive to households and businesses
Summary
Long-term trends including labor-saving technical change, globalization and urbanization have tended to disadvantage many Canadian rural communities in terms of population growth (Bollman and Mendelson, 1998; Agriculture and Agri-Food Canada, 2002; Rothwell et al, 2002). Glaeser, Kolko, and Saiz (2001), in an empirical study based on an optimal investment model, conclude that social capital accumulation decisions are driven by individual incentives, not group membership They point to the importance of understanding the externalities generated by social capital investments, concluding that it is not clear whether social capital should be cast as networks with positive externalities or status with negative externalities. We utilize a unique database provided by the Co-operative Secretariat of Agriculture and Agri-food Canada on the presence and type of co-operatives geo-coded to a very fine level of detail These data, along with a rich database of detailed community characteristics, including amenities and spatial identifiers, are used to assess the marginal impact of the presence of co-ops in rural community population growth.
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