This paper has two basic aims: the first is to understand why networks matter in the creation and maintenance of social capital; the second is to explore many of the (unproved) assumptions that arise when social capital is applied to the field of political participation. A simulation- based experiment is used to achieve both aims. The paper starts by delimiting the scope of the theoretical problem. It then reviews the assumptions made in the literature about the role networks play for social capital, and integrates them with what is known about dynamic networks. The third section provides a brief introduction to the methodological nature of simulation. It justifies the appropriateness of this technique to tackle the questions posed by the existing theory. A description of the simulation model and its results follows. The first set of experiments explores the structural properties of different networks in respect of information diffusion. The second set analyses a principle of action that might be responsible for the formation of social capital networks. The implications that these results have for the theory are assessed in the conclusion. Their links to future research are also discussed.