On Psychological Capital

The idea of psychological capital is becoming an important concept in our work. Here is our first attempt at developing a reasonably comprehensible definition of the term:

Psychological Capital phrase (sometimes referred to through the abbreviation PsyCap). The idea of psychological capital is a relatively new term. The term is most closely associated with the theory of ‘positive psychological capital’. Theories of positive psychological capital first emerged towards the end of the twentieth century and sought to extend the traditional focus of psychology from a concern with mental illness to one of mental wellness. It was the management specialist Fred Luthans who first codified the principles of positive psychological capital. In a management context psychological capital is associated with the development of key personal attributes including confidence, optimism, perseverance, and resilience, which collectively contribute to improved workplace performance. In broader terms, psychological capital can be understood as a form of enhanced psychological understanding of self and others. Understood on these terms, psychological capital occupies a space between human capital (a set of capacities that are associated with a person) and social capital (a set of capacities that are generated through the formation of inter-personal networks and alliances). At an individual level, the development of psychological capital is associated with a better understanding of, and control over, the thoughts and emotions that shape behaviours. At a broader social level, the development of psychological capital is related to: 1) a better understanding of the role of others in shaping our feelings and actions, and 2) a renewed sense of appreciation of, and compassion towards, the psychological drivers behind the actions of others. The development of psychological capital has been associated with a range of techniques including psychotherapy and Mindfulness training. Psychological capital appears to have much in common with emerging notions of spiritual capital.