Yet despite its scale and significance, the industry remains largely informal. It is governed less by formal contracts and clear regulatory systems than by relationships, trust and unwritten rules.

This makes the sector an important subject for industrial and economic sociology scholars like myself, who are concerned with how regulation, labour and economic life unfold in practice rather than merely on paper. Particularly in contexts marked by informality, inequality and contested regulatory environments.

In a recent study, my co-author and I explore how “social capital” – the networks, shared norms and trust that connect people – shapes the governance, labour relations and everyday functioning of the minibus taxi sector.

We conducted a structured search of academic databases and South African institutional repositories, and analysed 62 peer-reviewed articles, theses and policy reports to identify themes.

Our central finding is that social capital within South Africa’s minibus taxi industry operates as a double-edged sword. The same dense networks of trust, shared norms and reciprocal obligations that enable the industry to function also entrench inequality, exclusion and, at times, violence. Social capital is a source of both resilience and instability.

This matters because policy debates have too often treated the industry’s informality either as a problem to be eradicated or as a reality to be tolerated. Our research suggests that sustainable reform requires a hybrid approach: one that works with social capital rather than against it. Efforts to formalise or regulate the sector are unlikely to succeed if they ignore the networks and authority structures that already govern it.

It is therefore essential to engage with taxi associations, drivers and commuters, recognising their lived realities and institutional knowledge. It is possible to make the industry safer, fairer and more efficient without undermining the social foundations on which it depends.

An industry born of exclusion

The modern minibus taxi industry took shape during apartheid (1948-1990), when black South Africans were systematically excluded from formal urban planning and public transport provision. Commuters faced long journeys between racially segregated townships and economic centres, so entrepreneurs began operating minibuses to meet demand. The sector grew rapidly because it was responsive, decentralised and embedded in communities.

In the new democratic era after 1994, the industry continued to expand – but without being fully integrated into formal transport planning. Today, it comprises hundreds of thousands of vehicles organised into roughly 1,500 taxi associations nationwide. These associations regulate routes, manage disputes and coordinate operations. Alongside them are individual taxi owners, who own vehicles and lease them out, and drivers.

Part of the reason for this limited integration is that the state has lacked the institutional capacity and the political leverage to impose coherent oversight on the sector.

In the absence of consistent and effective state oversight, informal systems of governance have developed. These systems are rooted in social relationships.

Understanding social capital

The concept of social capital is often associated with political scientist Robert Putnam, who defined it as the networks and norms that enable collective action. According to this view, trust and civic engagement help communities solve shared problems.

But sociologist Pierre Bourdieu offered a more critical perspective. For him, social capital was not simply about cooperation. It was also a resource that groups could use to consolidate power and exclude others.

Drawing on these traditions, we distinguish between three forms of social capital in the taxi industry:

• bonding: tight-knit networks within taxi associations and owner groups

• bridging: connections across different associations or stakeholder groups

• linking: vertical ties between the industry and formal institutions such as government departments, banks and law enforcement agencies.

All three forms are present in the minibus taxi sector. But they operate unevenly, and their effects are not always positive.

The strengths of dense networks

Bonding social capital is particularly strong within taxi associations. These organisations function as powerful, if informal, regulatory bodies. They control routes, set fare guidelines and enforce industry norms. Membership provides access to shared resources and a measure of protection in a competitive market.

These dense networks allow for rapid coordination. If disputes arise, they can often be resolved internally without recourse to the courts. If demand shifts or new residential areas develop, associations can adjust routes quickly. In communities where formal institutions are perceived as distant or ineffective, such embedded systems can appear more responsive and legitimate.

Trust is also central to financial arrangements. Many taxi owners rely on rotating credit schemes and informal savings groups to finance vehicle purchases and maintenance. Formal financial institutions frequently regard the sector as high risk, making credit expensive or out of reach. Social networks therefore take the place of formal banking relationships.

The driver-owner relationship also depends heavily on trust. In many cases, drivers lease vehicles for a fixed daily fee, with no written contracts. Instead, expectations are governed by personal relationships and informal understandings.

In short, social capital fills gaps left by weak or uneven formal regulation enabling coordination, resilience and continuity.

When networks entrench power

However, the same bonding social capital that enables coordination can also reinforce hierarchy and exclusion.

Taxi associations control access to routes, which are the primary source of income. Because associations regulate who may operate on which routes, they wield considerable power. Dense networks of members can create barriers to entry for outsiders.

Disputes over routes are a feature of the industry. In some cases, they escalate into violence. Such conflicts arise in a system where economic survival depends on territorial control and where formal mediation mechanisms are weak.

Social capital here functions as a resource of dominance. Associations mobilise networks to maintain authority and legitimacy. Their links to communities can confer symbolic power, even in the absence of formal legal recognition.

Most drivers, by contrast, occupy a precarious position. Many are not members of associations in their own right. They lease vehicles from owners and have to meet fixed daily payment targets. To do so, they frequently work shifts exceeding 12 hours. If they fall short, they may absorb the loss themselves.

Without formal employment contracts, drivers typically lack access to medical benefits, unemployment insurance or retirement savings. Trust-based arrangements limit recourse in cases of exploitation or unfair treatment.

In this context, social capital benefits some actors more than others.

The missing links to formal institutions

While bonding social capital within associations is strong, linking social capital between the industry and formal institutions remains comparatively weak.

Government has attempted to formalise and regulate the sector, most notably through the Taxi Recapitalisation Programme. The aim was to replace older vehicles, improve safety and integrate the industry more fully into national transport policy. Yet implementation has been uneven, and many reforms have met resistance.

One reason is that policy interventions don’t “talk to” existing informal governance structures. Top-down regulation can be perceived as a threat to association autonomy. Where there is limited trust between the state and industry actors, compliance is likely to be partial.

Towards hybrid governance

The research suggests that industry reforms would have to recognise and work with social capital.

Formalisation should not simply impose external control. It should build on existing structures while introducing safeguards.

Legal recognition of taxi associations as cooperatives is one potential pathway. This could enhance access to subsidies, training and financial services. It could also clarify governance and accountability.

Standardised employment contracts for drivers are another step. They could provide greater security, define working hours and clarify dispute resolution processes.

Digital technologies may also help. Mobile payment systems could reduce reliance on cash, improve transparency and minimise disputes over fares. Digital platforms for route management could support fairer allocation processes and clearer record-keeping.

Drivers and commuters would have to take part in creating these solutions.

A delicate balance

The future of South Africa’s minibus taxi industry depends on striking a careful balance. Reform must recognise that the sector’s social capital is both its foundation and its fault line.

Strengthening bridging and linking social capital – across associations and between the industry and the state – can reduce conflict and foster shared accountability.

The challenge is not to dismantle the social fabric of the minibus taxi industry, but to reshape it, so that trust, cooperation and collective action serve all who depend on it.

Although our study focuses on South Africa, its implications extend more broadly. Across the global south, informal transport systems play a central role in urban mobility. They are often more adaptable than formal systems but also more vulnerable to conflict and labour exploitation.

Written by Siyabulela Christopher Fobosi, Senior Researcher, UNESCO 'Oliver Tambo' Chair of Human Rights, University of Fort Hare, University of Fort Hare

This article is republished from The Conversation under a Creative Commons license. Read the original article.