Nahapiet and Ghoshal 1998

Social Capital, Intellectual Capital, and the Organizational Advantage

Janine Nahapiet and Sumantra Ghosha

Intellectual Capital

• Types of Knowledge: Intellectual capital involves different types of knowledge. A key distinction is between practical, experience-based knowledge and theoretical knowledge, which is more abstract and derived from reflection.
• Explicit and Tacit Knowledge: Knowledge can be explicit (easily codified and shared) or tacit (more personal and harder to express). Tacit knowledge is often seen in high-reliability organizations, like flight operations teams, where complex, unspoken understanding is crucial.
• Social Knowledge: Intellectual capital also includes social explicit knowledge (objectified knowledge) and social tacit knowledge (collective knowledge). Organizations invest in developing objectified knowledge to pool and leverage distributed knowledge.
• Knowledge Creation: New knowledge can be created through incremental changes and development from existing knowledge. This process is essential for economic development and organizational growth.

Social Capital

• Definition and Importance: Social capital refers to the resources available through networks of relationships. It includes both the structure of these networks and the resources that can be accessed through them.
• Dimensions of Social Capital: Social capital can be defined in terms of three distinct dimensions, although these dimensions are not specified in the provided contexts.
• Common Characteristics: Despite its various forms, social capital shares common characteristics, such as the significance of relationships as a resource for social action.

This summary provides a basic understanding of how intellectual and social capital function within organizations, highlighting the importance of different types of knowledge and the role of relationships in accessing resources.