“What, exactly, is the Internet? Basically it is a global network exchanging digitized data in such a way that any computer, anywhere, that is equipped with a device called a ‘modem’, can make a noise like a duck choking on a kazoo” – Dave Barry, American writer.

Photo: LarimdaME, Creative Commons, Flickr

In the early days of the computer age, the newest and most complex computers took up no less than an entire building or very large room. At the time, few could have imagined the economic and social changes that would one day come from computers.

"For many in the counterculture of the early 1960s, computers had represented the epitome of all that was wrong with technology in the service of technocracy," writes Andrew Kirk. "Critics argued that computers were nothing more than ‘low-grade mechanical counterfeits’ of the human mind, devices propagated by the ‘most morally questionable’ elements of society."

At the time many critics dismissed the computer as the latest fad, just like the critics are now dismissing social networking sites as a fad. The computer proved the critics wrong, will Facebook similarly become a force that will change human society?

I stumbled across an interesting study that examines the relationship between use of Facebook and the formation and maintenance of social capital (The Benefits of Facebook Friends: Social Capital and College Students’ Use of Online Social Network Sites, written by Ellison, Steinfeld and Lampe). If you’re in the mood for some heavy reading, download the study here. If not, I hope you enjoy my idealistic and naive interpretation of the study.

Let’s start with some background. Social capital – defined as the resources accumulated through the relationships among people – has been linked to a variety of positive social outcomes, such as better public health, lower crime rates, and more efficient financial markets (Adler & Kwon, 2002). I’m not going to delve into the details here, but it basically boils down to who you know, not what you know – the more connections we have to the people around us, the more efficient and productive our society becomes.

According to several measures of social capital, this important resource has been declining in the U.S. for the past several years (Putnam, 2000). Putnam draws on evidence including nearly 500,000 interviews over the last quarter century to show that we sign fewer petitions, belong to fewer organizations that meet in person, know our neighbors less, meet with friends less frequently, and even socialize with our families less often. We’re even bowling alone. More Americans are bowling than ever before, but not in leagues.

A decline in social capital is a serious matter because researchers claim a community experiences increased social disorder, reduced economic output and potentially more distrust among community members when social capital declines (Helliwell & Putnam, 2004). My argument here is that social networking sites like Facebook can reverse the decline of social capital, a trend that has important implications for the sustainability of economic growth.

To understand why Facebook is so powerful, we have to distinguish between weak and strong ties. Strong ties are found between individuals in tightly-knit, emotionally close relationships, such as family and close friends. On the other hand, weak ties are loose connections between individuals without an emotional attachment.

As an example, if you’ve never met me, and add me as your Facebook friend, it will be considered a weak tie. The key idea here is that social networks like Facebook could greatly increase our ability to maintain weak ties, allowing us to create and maintain larger networks of offline relationships from which we could potentially draw resources (i.e. increases our social capital).

If you’re not convinced, just think of the offline marriages that are started on online dating sites, or using Facebook to stay in touch with your college friends. Such connections could have strong payoffs in terms of jobs, internships, and other opportunities.

Online interactions do not necessarily remove people from their offline world but may indeed be used to support offline relationships and keep people in contact, even when life changes move them away from each other. In the past we would maintain offline relationships by going for a cup of coffee, playing a round of golf, or talking over the telephone. Today we "Poke" friends to let them know we are thinking of them, we write on their "Wall" and we "Tag" them in our photos.

Facebook is a runaway success because it helps us to accumulate social capital, and the economic implications of Facebook’s contribution to our collective social capital must not be underestimated. So why don’t you increase your social capital and add me as your Facebook friend? I look forward to meeting you…