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Abstract

This paper conducts an exploratory analysis on the role of social capital in influencing both economic and social performance of farmer cooperatives based on a sample of 156 farmers from 54 vegetable cooperatives in China’s Hebei and Zhejiang provinces. Social capital is distinguished into bonding and bridging dimensions, with the former referring to the internal aspect of social capital and the latter the external “Guanxi” (meaning relationship) possessed by core members. The statistical results display that specific dimensions of social capital may not deliver the benefits expected by cooperative practitioners and academics. Both positive and negative effects of social capital on performances of farmer cooperatives are observed. To be specific, bonding social capital is positively associated with common members’ economic benefits. Bridging social capital generates beneficial outcomes for the financial and social performances of cooperatives, while exhibiting negative influence on common members’ income increase because of member heterogeneity.

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