Measuring the monetary value of social capital in Tehran

Calculating the monetary value of social capital give decision makers the opportunity to expand and strengthen dimensions that are more valuable to the people. The purpose of this study was to estimate the monetary value of social capital in Tehran. In order to this, social capital questionnaire was distributed between 345 people then by having capita income annual per households an estimated Probit model was estimated using STATA13. To estimate the parameters, use eight regression models, and after estimating the welfare function, the monetary value of social capital using the shadow price model was estimated in two steps.The results show that on average a one standard deviation increase in interpersonal-trust is worth an extra 7000000, in people’s-fairness 2000000, institutional-trust 16000000, and in Trustworthiness is 3000000 Rial per year in terms of foregone income. In the field of informal participation and Meeting-people have been worth an extra 1500000 and 4000000 Rial respectively. The findings indicate that social capital has significant monetary value to individuals. This should be considered when designing government policies aiming at e.g., labor market mobility that are accompanied by a decreasing social capital stock that, in turn, may negatively affect economic and political development.