Social Capital and Farmer Welfare in Malaysia

Abstract

Effects of social capital on household welfare (rice yield, income, health) were examined in a rice granary area of southern peninsular Malaysia. Social capital is categorized into structural and cognitive. OLS and 2SLS were used for estimation on data from 59 randomly selected households. As for productivity, structural social capital (frequency of community activity attendance) contributes to higher rice yield. To enhance economic welfare, cognitive social capital (group norm) which is expected to strengthen work ethic appears important. As for self-rated health status, those actively involved in educational organizations (PTA) feel themselves less healthy. On the other hand, those who put high value on local organizations tend to be healthy. On the whole, both structural and cognitive social capital enhancement are expected to improve Malaysian farmer welfare.