Social Capital and Poverty Reduction: A Case Study of the Integrated Social Service Program in Madiun

ABSTRACT: Regionalgovernmentpolicies in general in povertyreduction in Madiun Regency still use an economic approach, such as infrastructure development (physical capital), credit assistance (financial capital), and education and health assistance (human capital). The problem of povertyis a complex problem, involving many resources including one of them is social capital. This studyanalyzed the role of social capital in povertyreduction in rural households in Madiun. Social capital ismeasuredbased on the dimensions of social capital index (mutual trust, norms, mutualcooperation, participation in social activities, and social networking), while poverty is measured by per capita householdexpenditure. The method of analysisusedwasmultiple linearregressionmodels in a sample of 3,473 households. The source of the data obtainedfrom the results of the BPS survey of Madiun Regency, namelySusenasin 2018. The results of the analysis show that the average index of household social capital in rural areas is 52.18 (maximum 100). The component thatmostplays a role in the formation of social capital for poorhouseholdsismutual trust. The results of the analysis show that social capital together with human capital, financial capital, and physical capital have a positive effect on household per capita expenditures, which can reduce poverty. This illustrates that social capital has an important role in povertyreduction in rural areas..
KEYWORDS: Social Capital, Poverty, Rural Area