The enrichment of social capital: A study about the influence of social capital on ethnic differences on risk of poverty

Abstract

Previous research used social capital as an explanation for differences in income. However, less is known about the influence of social capital on ethnic differences in risk of poverty. Therefore, this study focuses on migrants’ extent of social capital as an explanation for differences in risk of poverty and on the possible moderating effect of socio-cultural integration on the relationship between social capital and risk of poverty. Linear probability models have been conducted, using the first wave of the NELLS dataset. It is found that Turks and Moroccans have a higher risk of poverty than natives. Also, evidence has been found for generational differences in risk of poverty. First-generation migrants have higher risk of poverty chances than their second-generation counterparts. The ethnic differences can be partly explained by social capital, which has been measured using the name generator and the position generator. Further, it was found that the position generator has a slightly stronger effect than the name generator on decreasing chances of risk of poverty. This implies that a diverse network is more effective in reducing risk of poverty than the core network. Surprisingly, socio-cultural integration weakens the relation between social capital and risk of poverty.