Social Capital and its Impact on Economic Development in Hamden Province

Social capital is considered to be a determinant factor in development experiences and policies in contemporary advanced societies; despite its short history in social sciences and economics literature, social capital has appeared as important as human and physical counterparts. Using quantitative methodology, this paper aims at investigate the impacts that social capital has on economic activities; in this respect, the degree of social capital was measured through questionnaire in all cities of Hamadan province; then, its influences on economic activities was explored focusing on urban areas.The findings demonstrated a low degree of social capital which in turn leads to criminal behaviors, disobedience of law, and high mistrust. The mentioned factors has resulted to increasing cost of production and decreasing rate of economic productivity. In addition, this study showed that there is a significant and negative interrelationship between social capital, economic growth and enterprise in private section; thus, the low degree of social capital has negative impact on economic units through increasing cost of production.