Social Capital and Organizational Performance: Evidence from Urban Public Schools

In this paper we examine social capital and its relationship with performance at the organizational level. We predict that both internal and external social capital will have a positive effect on organizational performance. We test our hypotheses in 88 urban public schools where we collected data from principals, teachers, parents, and students. Results indicate that both internal social capital (relations among teachers) and external social capital (relations between the principal and external stakeholders) predict student achievement in mathematics and reading. These effects were sustained over time for reading achievement, providing support for a causal relationship between social capital and performance. We provide evidence that social capital’s impact on student achievement in math—but not reading—is mediated by the quality of instruction provided by teachers. These results underscore the importance of context in studies of social capital.