Objective. This study tests the claim that areas with higher levels of social capital have superior economic performance. Method. The 14‐measure index of social capital created by Robert Putnam is reconstructed for an extended time period and integrated into cross‐sectional regression models including physical capital, human capital, and other factors relevant to state economic performance. Results. The analysis shows that social capital has no discernable influence on aggregate measures of output and employment. However, it does have a positive and significant impact on measures of economic equality and employment stability. Conclusions. This study does not support the claim that social capital is a general prerequisite for prosperity, but it does suggest that it may serve to reinforce a particular mode of communitarian economic development.

Is social capital a prerequisite for prosperity? This paper analyzes social capital and economic performance in the British regions. Like Italy, Britain has a north–south economic divide. Are these differences caused by unequal stocks of social capital? This paper provides limited support for the hypothesized relationship between some indicators of social capital (especially trust and civic associations) and economic performance. Economic associations, however, are negatively correlated. This highlights shortcomings in social capital theory in terms of transferring the concept to new settings, the mechanisms linking social capital to production and the translation of social capital into public policy.

This article• Examines the global financial crisis through the larger lens of the optimal models of growth for the Anglo-American political economies. • Offers a concise yet thorough synthesis of two major explanations-the debt-driven growth hypothesis and the financial instability hypothesis-of the global financial crisis. • Analyzes substantial empirical evidence for both hypotheses, calling into question the utility of the widely cited debt-driven growth hypothesis. • Offers a novel interpretation of how the financial instability hypothesis can in fact be interpreted as showing the potential for stabilizing the neoliberal model of growth through macroprudential financial regulation. • Outlines the major elements and institutions of macroprudential regulation and examines both the potential and pitfalls of this approach.For many, the 2008 global financial crisis (GFC) signaled the end of neoliberalism. This article argues that the crash was less the exhaustion of the free market model as a problem of excessive credit. Focusing on Anglo-American economies, this article explores two competing hypothesesdebt-driven growth and financial instability. The rationale and empirical evidence for both are reviewed, showing that the financial instability hypothesis, with its emphasis on financial (credit) cycles, offers the more compelling explanation. The main flaw of the neoliberal growth model is a tendency for excessive credit growth, producing crashes that wipe out gains in the real economy. The solution is macroprudential financial regulations-broad controls on financial markets to smooth the credit cycle. Implementing macroprudential financial controls could 'save' neoliberalism by securing its more robust output while limiting the disruptive financial shocks that serve to undercut that dynamism.

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