“Capital”: Material, Human, Social
• Material Capital: (tools, machinery, physical plant)
• Human Capital: what makes more productive use of material capital.
• Social Capital: what makes more productive use of material & human capital.
(Gladwell’s introductory chapter).
• Further sub-genres include: Cultural capital, Emotional Intelligence, etc.
• Human Capital is what makes one person more productive than another.
– Different from physical capital for which standard example is
machinery: eg a computer or a sewing machine or a lathe.
• Given several people working with the same machinery / tools some will be
more productive than others: or have been trained to be more productive.
Adam Smith on Individual Abilities and their Aggregation.
• “… the acquired and useful abilities of all the inhabitants or members of the
society. The acquisition of such talents, by the maintenance of the acquirer
during his education, study, or apprenticeship, always costs a real expense,
which is a capital fixed and realized, as it were, in his person. Those talents, as
they make a part of his fortune, so do they likewise that of the society to which
he belongs. The improved dexterity of a workman may be considered in the same
light as a machine or instrument of trade which facilitates and abridges labor,
and which, though it costs a certain expense, repays that expense with a profit.”.
• Smith, Adam: An Inquiry into the Nature And Causes of the Wealth of Nations
Book 2 - Of the Nature, Accumulation, and Employment of Stock; Published 1776.
• Sociologists have extended notions ofhuman capital to social capital, cultural
capital, etc. Also “Erotic capital”.
– Physical attractiveness is relevant in the entertainment industries but
also correlates with success in other areas.
a. Catherine Hakim, Honey Money: the power of erotic capital. Basic Books.
b. Daniel Hamermash, Beauty Pays: why attractive people are more
successful. Princeton UP. 2011.