Summaries The role of social capital has come to the fore in recent development analysis in which the level of institutional capacity and consequent level o economic development depends on the amount of social capital available. Economies managing transition have revealed weak institutional capacity: social capital is minimal and distrust predominates. A project in southern Albania illustrates the problem of low social capital. Introducing and transferring techniques of participation in decision‐making over local economic development enabled the creation of networks and local organisations, beginning the process of social capital accumulation to strengthen institutional development and enhance economic performance.