The contribution of social capital on rural livelihoods: Malawi and the Philippines cases

This paper explores the efficacy of a development model designed to enhance social capital where social capital is seen as a catalyst to increased economic opportunities. The study covers smallholder livestock producers in Malawi and the Philippines. The key question examined in this paper is whether communities that received this specific development intervention significantly increased their access to social capital over time and whether this social capital is positively correlated with net farm income and improved livelihoods. We draw data from two case studies: Heifer International’s Malawi Smallholder Dairy Development Project (MSDD1) and the Philippine Raising Income of Families through Sustainable Agri-Business Project (RICSA). The examination of these two cases increases our understanding of how implementation and contextual variables may influence changes in social capital and livelihoods. The study applies social network analysis (SNA) to understand the connection between asset-based/human capacity interventions and social capital. SNA provides a quantitative measure of networks and households’ position within those networks as indicators of social capital. Real net income which includes the value of home consumption is used as a proxy for ‘improved livelihoods.’ A quasi-experimental design is used to determine whether social capital and income variables change significantly over time and whether social capital is correlated with income. The results revealed significant differences across the two cases. In the Malawi case, the intervention significantly contributed to social capital formation. In the Philippine case study, the social capital did not demonstrate a significant difference. The dissimilarity between the two cases shows that it takes time to deepen bonds of trust and reciprocity and to extend networks as conduits of knowledge, information and economic opportunity.