Using the Social Capital of Nationals Abroad as a Strategy for Development in the IT Sector

This Discussion Paper examines the relevance of social capital theories in explaining the migration-development nexus. The author uses three case studies to investigate this relationship, namely developments in the information technology (IT) sector in China, India and Taiwan (China). There are booming IT sectors in all these economies; these are important source regions of highly-skilled migrants; and they are all well represented in Silicon Valley which is considered to be the most important hub in the IT sector worldwide. The paper focuses on three distinct sources of social capital: trust, reputation and networks, and finds that social capital theories can indeed contribute to explaining the migration-development nexus -- at least as far the IT sector is concerned.