Social Capital and the Growth of the Nonprofit Sector

Posted: 11 Nov 2009

See all articles by Gregory D. Saxton

Gregory D. Saxton

SUNY College at Brockport

Michelle Benson

State University of New York at Buffalo

Date Written: 2005


The extent to which nonprofit organizations are created by various forms of social capital is examined.Data are developed from the Social Capital Community Benchmark Survey, the Internal Revenue Service's "charitable organization" Business Master Files, and other federal data sources. The number of nonprofit organizations founded in 284 U.S. counties in the year 2001 was analyzed, along six dimensions of social capital: "bridging" social ties, political engagement, giving and volunteering, civic engagement, informal socializing, and social trust.Two core dimensions—political engagement and bridging social ties—have a major impact on county-level nonprofit organization creation.A key element of social capital in the literature—the level of interpersonal trust—does not lead to an increase in development of new not-for-profit organizations. Findings reinforce the evidence of the strength of political contacts and bridging ties for the vitality of the community.The various dimensions of social capital do not have a uniform effect on nonprofit sector growth at the community level.The growth of a community's not-for-profit sector is dependent on a mix of ecological and environmental factors that include pre-existing organizational density, median household income, unemployment, and levels of government spending. (JSD)

Keywords: National Center for Charitable Statistics, Social Capital Community Benchmaking Survey, IRS Business Master Files, U.S. Bureau of the Census, Community organizations, Not-for-profit organizations, Social capital, Startups

Suggested Citation

Saxton, Gregory D. and Benson, Michelle, Social Capital and the Growth of the Nonprofit Sector (2005). University of Illinois at Urbana-Champaign's Academy for Entrepreneurial Leadership Historical Research Reference in Entrepreneurship, Available at SSRN:

Gregory D. Saxton (Contact Author)

SUNY College at Brockport ( email )

Brockport, NY 14420
United States

Michelle Benson

State University of New York at Buffalo ( email )

12 Capen Hall
Buffalo, NY 14222
United States

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