MANAGING SOCIAL CAPITAL AND DIVERSITY FOR PERFORMANCE IN PUBLIC ORGANIZATIONS

Managers concerned with the performance of their organizations will exploit available social, administrative, and human capital resources. However, extant theory and mixed empirical evidence leave the effect of social capital on performance unclear. The gains from these norms of reciprocity, participation, networking, and trust may disproportionately benefit only some of their clients, leading to disparities in outcomes among diverse clienteles. We argue that in such contexts, management will put in place policies to counter these disparities. Indeed, our empirical evidence from the management of public education supports the expectation that an institutional commitment to diversity successfully mitigates the uneven effects of social capital on organizational performance. This finding carries important implications for public management and equity in public policy outcomes and may be of particular relevance to management of outcomes relying on co‐production.