Social capitalism

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Social-Capitalism as a theory challenges the idea that Socialism and Capitalism are mutually exclusive. Social-Capitalism posits that a strong social support network for the poor enhances capital output. By decreasing poverty, capital market participation is enlarged.

Social-Capitalism divides the concept of economy into two tiers: A participatory group of society working functionally in an upper economy (Tier-One) and an underlying economy of dependent poor communities and criminal elements(Tier-Two). Tier-One generally comprises the upper and middle classes while Tier-Two represents many low wage workers, impoverished persons, mentally ill and criminals. Social capitalism posits that providing Tier-Two with the means to participate in the market would discourage Tier Two from completely dropping out of the system, hence, causing major disruptions to the market. A larger and more inclusive market is a more efficient and more stable market.

"Social Capitalism" is not related to the idea of "social capital" as popularized by Robert Putnam and James Coleman.