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A number of studies have revealed that social capital, while the concept lacks a clear definition, may have pervasive and significant effects on public policy. To help inform public opinion on social capital this paper reviews social capital theories and concepts, and related empirical work, and discusses some of the possible ramifications for public policy. Key points in the discussion include: that social capital is an evolving concept relating to social norms and networks; that social capital can generate benefits to society by reducing transaction costs, promoting cooperative behaviour, disseminating knowledge and innovations and enhancements to personal well-being; that some aspects of social capital are not beneficial such as when strong group cohesion may be associated with intolerance of others; that while Governments carry out many functions that support social capital, some programs and regulations may erode social capital; that while devising policy to create social capital can be problematic, programs that erode social capital should be modified and existing programs that support social capital should be made more effective; and that at the present time because of the limited understanding of social capital and its interaction with policy, measurement and evaluation are difficult, necessitating further research.