Samples Finance Types of Capital

Types of Capital

1205 words 5 page(s)

John Brym and Robert Lie authored the book Sociology: Your compass for a new world. This paper analyzes what Brym and Lie say about social stratification and other aspects of inequality in the third edition of the book. It argues that the authors’ position is that it is possible to overcome or reduce inequality: for this one needs to recognize that patterns of wealth and inequality change overtime, promote the role of three capital types for income, define poverty in a way that aids the poor, and view stratification as temporary.

Wealth and Inequality
Wealth of people is defined by sociologists as fixed assets that individuals own. Wealth leads to many benefits, however, the patters of wealth change with time. Brym and Lie (2008) state that “because you can afford to engage in leisure pursuits, turn off stress, consume high quality food, and enjoy superior medical services, you are likely to live a healthier and longer life than someone who lacks these advantages.” (112). This argument establishes that wealth is better than poverty and the lack of wealth as it provides individuals with assets with many things that others do not have. Also, it implies that inequality concerns the differences among people that determine some basic necessities like access to good medical service.

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Further, the authors observe that the pattern of wealth has changed for the worse, mainly “…the net worth of the middle fifth [population divided into five groups according to net wealth] increased by 79 percent. However, the net worth of the second-poorest fifth of Canadians increased by just 42 percent, while the net worth of the poorest fifth of Canadians declined by 15 percent.” (114).

The change in wealth can result in inequality when the poor become poorer and the wealthy got even more rich; likewise, an increase in the wealth by the poor would produce more equality. The authors view this opportunity for equality in the changing pattern of income: the income of Canadians i.e. their earnings over a time span, improves with the recognition of role of learning for income, mainly “the importance of education as a determinant of occupation and income…” (115).

Types of Capital: Human, Social, and Cultural
Education is a factor in the changing patterns of wealth and income, however, the education and training must address three types of capital to have an effect on income and wealth. The authors show how each capital type influences the ability of Canadians to move up the social ladder and achieve equality with the wealthier fifth of the population. First, “human capital is investment in education and training” (116). Its effect is achieved by employees becoming “more skilled and more productive … because they have made investments in acquiring the skills and knowledge essential for our economy” (116). Second, social capital i.e. networks and connections improve the prospects for upward mobility since individuals build “strong bonds of trust, cooperation, mutual respect, and obligation” (116). Third, cultural capital that includes social skills functions in regard to one’s “ability to influence others” (117). Thus, while education is critical for reducing inequality, the three types of capital need to be present.

Types of Poverty
Poverty types include absolute and relative poverty, in sociological terms. Brym and Lie (2008) underline the importance of how poverty is defined. The authors challenge the concept of absolute poverty, defined as “inadequate resources to acquire the necessities of life (food, clothing, and shelter). (117). They state that poverty’s definition should aid politicians to “reshape the distribution of income” (118) and that the types of poverty are not useful for the poor unless “social policies are enacted … based on levels and trends in poverty” (118). Further, the typology of poverty depends on what is considered a basic necessity. In the words of the authors, the definition can be narrow or broad “in terms of economic measures … with respect to community standards” (117). A better approach for reducing inequality could be to ask why people are poor. The authors propose that currently, the definition of poverty does not always address reality, for example “Many Canadians argue that providing welfare benefits … perpetuates poverty” (120).

Stratification
The authors discuss three sociological theories of social stratification i.e. Marx’s conflict theory, the functionalist theory, and Weber’s theory. These theories propose different views of social divisions and how social mobility is achieved. The authors’ criticism on Weber’s theory that views stratification as influenced by status groups is that “the level of social stratification depends on the complex interplay of class, status, and party, and their effect on social mobility” (124). Thus, the opposite of a permanent social stratification is social mobility, “movement up and down the stratification system” (124), that can be attained in the Canadian society. The authors propose that the change is possible when achievement is recognized, mainly by asking if “Canada’s investment in education expansion reduced the amount of ascription in educational attainment” (125).

Summary and Conclusion
Inequality exists because people recognize the benefits of wealth and that large groups of people enjoy less benefits since they are poor. The level of inequality in Canada has changed in a detrimental way for the poorest groups, because only the wealthy groups have benefited. However, this does not preclude future improvements in inequality in view of the changes in wealth and income patterns. Most importantly, education has contributed positively to the improvements in income.

Still, the changes in people’s education are inconsequential for wealth and income unless the three types of capital are gained during training. Human capital is equated with education and skills, while social capital promotes the social connections that are needed for success. Cultural capital further improves income prospects.

Poverty is often divided into absolute and relative, but Brym and Lie (2008) suggest to avoid this typology. This is necessary because it is not always clear what are the necessities valued by the poor. Also, current definitions fail to reflect reality and can perpetuate myths about the poor.

Stratification is yet another aspect of inequality found in the Canadian society. However, there is no agreement on stratification as sociological theories explain it differently. For example, Weber’s theory views social stratification as determined by people who have status and power. This theory is used by the authors to demonstrate that mobility is possible. Mainly, social mobility is promoted to recognize achievements of people rather than their social status, so that inequality is overcome. In conclusion, the Canadian society can reduce or overcome inequality because of the changing patterns in wealth and income, by recognizing the role of education, particularly social and cultural capital for income and equality, by defining poverty so that it benefits the poor, in addition to reduce stratification with achievement-based social mobility.

Comment: Brym and Lie (2008) explain how inequality functions in Canada, applying modern sociological thought. However, in the reading, there is no comparison of inequality, stratification, and mobility in Canada and other countries.
Question: Can one sociologically determine that the same things that lead to inequality in Canada influence inequality in other places? For example, did another country successfully improve equality by applying these concepts i.e. the definition of poverty, social stratification and mobility, and the three types of capital?

    References
  • Brym, R. J. & Lie, J. (2008). Sociology: Your compass for a new world. Vancouver, B.C: Langara College.

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