Industry associations as facilitators of social capital: the establishment and early operations of the Melbourne Woolbrokers Association

Authors

David Merrett, University of Melbourne
Stephen Morgan, University of Nottingham
Simon Ville, University of WollongongFollow

RIS ID

24578

Publication Details

Merrett, D., Morgan, S. & Ville, S. (2008). Industry associations as facilitators of social capital: the establishment and early operations of the Melbourne Woolbrokers Association. Business History, 50 (6), 781-794.

Abstract

Relocation of the selling of Australia's wool clip from London to cities in Australia in the late nineteenth century led to the creation of wool selling industry associations, such as the Melbourne Woolbrokers Association (MWA). Highly successful in fostering competitive collaboration that improved market efficiency, the Association rested on the social capital brought to it and further developed by the participants, individuals with extensive connections in the pastoral, banking and transport industries. The collective social capital vested in the Association enabled the earning of economic rents, firstly from the high trust created through internal cohesion reinforced by formalised sanctions, and secondly from a capacity to span 'structural holes' between networks outside of the Association.