Social Entrepreneurship and Institutional Factors: A Literature Review
During recent decades, the interest of academia and policy-makers in social entrepreneurship has been increasing, due to its impact on social and economic development. The main objective of this chapter is to explore the content and methodology used in social entrepreneurship research focusing on the institutional economics perspective. The literature review was based on articles published in top journals, especially those included in the Web of Science. The main findings suggest that social entrepreneurship literature has tended to focus describing experiences of the most popular social entrepreneurs, their personal characteristics and their key success factors. Additionally, the vast majority of the literature is classified as conceptual research. Likewise, empirical research is characterized by the use of case study methodology. The study has both theoretical (for the development of the literature in the social entrepreneurship field) and empirical implications.
KeywordsSocial entrepreneurship Social entrepreneurial activity Institutional factors Literature review
A new type of entrepreneurship called social entrepreneurship is emerging around the world. Social entrepreneurship is based on the creation of social wealth as its main objective as opposed to the generation of economic wealth (Dees 2001; Drayton 2002; Leadbeater 1997; Stevens et al. 2015). Entrepreneurship has received increasing recognition from governments, academia and civil society due to their role to enhance the development of societies. While social entrepreneurship grew from a business opportunity or a social need, new business creation increase employment and economic and social development, stimulate innovation and enhance well-being (Audretsch and Keilbach 2004; Urbano and Aparicio 2016; Wennekers and Thurik 1999; Wennekers et al. 2016). Similarly, social entrepreneurial activities are increasingly recognized as an element of the economic, social and environmental contributions to society (Borzaga and Defourny 2001; Mair et al. 2006; Peredo and McLean 2006). Some researchers (Maclean et al. 2013; Yunus and Weber 2008) highlight the importance of the role of the social entrepreneurial activities due to they could impact on the economic growth, helping reduce poverty rate and improving large-scale social development across countries.
Social entrepreneurship is a new concept, but it is not a new phenomenon (Dees 2001). According to Nicholls (2006), the concept of social entrepreneurship was first used between the 1970s and the 1980s. However, it was not until the 1990s that the term came into widespread use as a result of increased global social problems (Bornstein 2004). In the past, social entrepreneurs were called visionaries, humanitarians, philanthropists, reformers or activists (Bornstein and Davis 2010). Although organizations with a social purpose have existed for many years, they have recently received increasing attention at a scholarly and governmental level (Dees 2001; Leadbeater 1997).
The increasing dynamism and vitality of the social entrepreneurship inquiry are apparent in the appearance of new themes and ideas, as well as new books and special issues of the best international journals around the world (Chell et al. 2010). Within entrepreneurship inquiry, the number of articles and special issues in the social entrepreneurship area has increased significantly (e.g. Journal of Business Venturing 2009; Entrepreneurship Theory and Practice 2010; Entrepreneurship & Regional Development 2011; Academy of Management Learning & Education 2012; International Small Business Journal 2013; among others), which, together with the emergence of new international journals on this phenomenon (e.g. Journal of Social Entrepreneurship, International Journal of Social Entrepreneurship and Innovation or Social Enterprise Journal), demonstrates the new dynamics of research in entrepreneurship. Likewise, specific books (e.g. Brooks 2009; Elkington and Hartigan 2008; Hockerts et al. 2010; Leadbeater 1997; Light 2008; Mair et al. 2006) about social entrepreneurship and international conferences have appeared.
Institutional economics is especially applicable to social entrepreneurship. The literature shows that social entrepreneurs aim at alleviating the social problems of their institutional framework and on many occasions the local problems that persist despite the efforts of traditional public, voluntary or community mechanisms (Yunus and Weber 2008). Thus, to facilitate understanding, we turn to an institutional perspective by arguing that social entrepreneurial activity can be facilitated and constrained by the institutional framework (Urbano et al. 2010). In general terms, North (1990: 3) defines “institutions are the rules of the game in a society, or more formally, institutions are the constraints that shape human interaction”. Institutions can be either formal, such as constitutions, regulations, written rules or informal, such as attitudes, values, norms of behavior and conventions.
According to the above, the main purpose of this chapter is to explore the content and methodology of social entrepreneurship research focusing on the institutional approach and to identify the main traits of these studies (e.g. streams of the field, methodological techniques and main institutional factors, among others). The literature review was based on articles published in top journals and special issues related to social entrepreneurship, especially those included in the Web of Science1 that consider this phenomenon. Moreover, we included articles published in specific social entrepreneurship journals and books (e.g. Bornstein 2004; Light 2008; Mair et al. 2006; Nicholls 2006; among others). We conducted the search according to the following keywords: “social entrepreneurship”, “social entrepreneur”, “social enterprise”, “institutions” and “institutional factors”.
The main findings suggest that the social entrepreneurship literature has tended to focus on renowned social entrepreneurs’ experiences and personal characteristics, as well as leadership and success factors. However, there is no solid evidence regarding one of the most interesting aspects of social entrepreneurship: the study of how the environmental factors affect (promote or inhibit) the emergence of social entrepreneurial activities (Urbano et al. 2010). In this sense, an important number of both theoretical and case studies can be found (Bacq and Janssen 2011; Desa 2012; Dhesi 2010; Estrin et al. 2013; Mair and Marti 2009; McMullen 2011; Sud et al. 2009; Townsend and Hart 2008). Despite this, most studies deal with the issue in a fragmented and excessively descriptive way. This lack of empirical studies places limits on our understanding of social entrepreneurial activities, so it is important to direct efforts in this direction (Mair and Marti 2006; Short et al. 2009).
The contributions of this study are made in terms of identifying the main issues and traits that have been discussed in the academic area so far and the development in the field of social entrepreneurship from an institutional perspective. Also, having a clear idea about the institutional framework for social enterprise creation can help to guide public policies relating to social enterprise creation.
Following this introduction, the chapter is organized as follows. Section 2.2 discusses the state of the research on social entrepreneurship, identifying knowledge gaps based upon under-studied themes and insufficient or inadequate methodological development. Section 2.3 presents institutional economics as an appropriate conceptual framework for the analysis of social entrepreneurship, suggesting some theoretical propositions and the conceptual model. Finally, in Sect. 2.4 the main conclusions, limitations and future research lines are presented.
2.2 Social Entrepreneurship: Current State of the Art
2.2.1 Contents of Existing Research on Social Entrepreneurship
Main definitions of social entrepreneurship
“Play the role of change agents in the social sector, by: 1) Adopting a mission to create and sustain social value (not just private value), 2) Recognizing and relentlessly pursuing new opportunities to serve that mission, 3) Engaging in a process of continuous innovation, adaptation, and learning, 4) Acting boldly without being limited by resources currently in hand, and 5) Exhibiting heightened accountability to the constituencies served and for the outcomes created.” (p. 4)
“Social entrepreneurship is the creation of viable (socio-) economic structures, relations, institutions, organisations and practices that yield and sustain social benefits.” (p. 649)
Lasprogata and Cotten
“Social entrepreneurship means nonprofit organizations that apply entrepreneurial strategies to sustain themselves financially while having a greater impact on their social mission.” (p. 69)
Alvord, Brown and Letts
“Social entrepreneurship that creates innovative solutions to immediate social problems and mobilizes the ideas, capacities, resources, and social arrangements required for sustainable social transformations.” (p. 262)
Austin, Stevenson and Wei-Skillern
“We define social entrepreneurship as innovative, social value creating activity that can occur within or across the non-profit, business, or government sectors.” (p. 2)
Mair and Marti
“We view social entrepreneurship broadly, as a process involving the innovative use and combination of resources to pursue opportunities to catalyse social change and/or address social needs.” (p. 37)
“Social entrepreneurship represents an umbrella term for a considerable range of innovative and dynamic international praxis and discourse in the social and environmental sector.” (p. 5)
Peredo and McLean
“Social entrepreneurship is exercised where some person or group: (1) aim(s) at creating social value, either exclusively or at least in some prominent way; (2) show(s) a capacity to recognize and take advantage of opportunities to create that value (“envision”); (3) employ(s) innovation, ranging from outright invention to adapting someone else’s novelty, in creating and/or distributing social value; (4) is/are willing to accept an above-average degree of risk in creating and disseminating social value; and (5) is/are unusually resourceful in being relatively undaunted by scarce assets in pursuing their social venture”. (p. 64)
Sharir and Lerner
“To apply business strategies for the purpose of more effective confrontation with complex social problems”. (p. 16)
Weerawardena and Mort
“We define social entrepreneurship as a behavioural phenomenon expressed in a NFP organization context aimed at delivering social value through the exploitation of perceived opportunities”. (p. 25)
Zahra, Gedajlovic, Neubaum and Shulman
“Social entrepreneurship encompasses the activities and processes undertaken to discover, define, and exploit opportunities in order to enhance social wealth by creating new ventures or managing existing organizations in an innovative manner”. (p. 522)
Bacq and Janssen
“We define social entrepreneurship as the process of identifying, evaluating and exploiting opportunities aiming at social value creation by means of commercial, market-based activities and of the use of a wide range of resources”. (p. 376)
Choi and Majumdar
“We propose the conceptualization of social entrepreneurship as a cluster concept (…). Conceptualizing social entrepreneurship as a cluster concept implies that social entrepreneurship is a representation of the combined quality of certain sub-concepts, i.e., social value creation, the social entrepreneur, the SE organization, market orientation, and social innovation”. (p. 372)
The interest in social entrepreneurship is not only reflected in the growing literature on the topic but also in the proliferation of terms used to identify the concept itself. As can be seen in Table 2.1, the number of definitions used to describe social entrepreneurship has increased in the articles of international journals and in books. As mentioned by Chell et al. (2010) and Bacq and Janssen (2011), social entrepreneurship means different things to people in different places because of the different geographical and cultural contexts in which it takes place, as well as differences in welfare and labour markets. According to Friedman and Desivilya (2010), there are at least two major contexts in which the notion takes on different meanings: the Anglo-Saxon and European traditions. Likewise, under the concept of social entrepreneurship, other types of social entrepreneurial activities are discussed, such as social venturing, non-profit organizations adopting business tools, hybrid organizations or social cooperative enterprises (Smallbone et al. 2001).
Despite the different meanings, a key distinction that can be found in all the definitions is a social mission as the central driving force of social entrepreneurs (Leadbeater 1997). The decision regarding the particular organizational form a social enterprise takes should be based on whichever format would most effectively mobilize the resources needed to address the problem in order to produce a social impact on the current social institutions (Austin et al. 2006; Chell et al. 2010; Peredo and McLean 2006).
Main research lines
Defining the phenomenon
What is social entrepreneurship?
Alvord et al. (2004), Anderson et al. (2006), Bacq and Janssen (2011), Certo and Miller (2008), Chell et al. (2010), Choi and Majumdar (2014), Dees (2001), Drayton (2002), Ebrashi (2013), Mair and Marti (2006), Mort et al. (2003), Nicholls (2006), Peredo and McLean (2006), Short et al. (2009), Tan et al. (2005), Thompson (2002), Thompson et al. (2000), Wallace (1999), and Zahra et al. (2014)
What does a social entrepreneur do?
What are social enterprises like?
Comparison between social entrepreneurship and other forms of organization
What are the differences between social and commercial entrepreneurship?
Almarri et al. (2013), Austin et al. (2006), Bacq et al. (2013), Bargsted et al. (2013), Fowler (2000), Gimmon and Spiro (2013), Luke and Chu (2013), Lumpkin et al. (2013), Sastre-Castillo et al. (2015), Seelos and Mair (2005), Spear (2006), Thompson and Doherty (2006), and Williams and Nadin (2012)
What are the differences between social entrepreneurship and government, NGO’s, activism?
Study the core elements of social entrepreneurial process
How is the social entrepreneurial process?
Chalmers and Balan-Vnuk (2013), Corner and Ho (2010), Cornwall (1998), Dhesi (2010), Engelke et al. (2015), Gras and Mendoza-Abarca (2014), Harris (2009), Kaneko (2013), Ko and Liu (2015), Lasprogata and Cotten (2003), Meyskens et al. (2010), Özdemir (2013), Renko (2013), Rotheroe (2007), Salamzadeh et al. (2013), Shaw and Carter (2007), Stevens et al. (2015), Tobias et al. (2013), Weerawardena and Mort (2006), and Zahra et al. (2008).
What are social opportunities?
How do social entrepreneurs evaluate their impact?
Identify predictors of social entrepreneurship
Which are the main environmental factors that could affect the social entrepreneurship process?
Amin et al. (2002), Bhatt and Altinay (2013), Bjerregaard and Lauring (2012), Campin et al. (2013), Desa (2012), Di Domenico et al. (2010), Dorado and Ventresca (2013), Felício et al. (2013), Kao and Huang (2015), Ladeira and Machado (2013), Maclean et al. (2013), Mair and Marti (2009), McMullen (2011), Muñoz and Kibler (2015), Neck et al. (2009), Nga and Shamuganathan (2010), Nicholls (2010a, 2010b), O’Connor (2013), Roy et al. (2015), Sharir and Lerner (2006), Smith and Stevens (2010), Smith et al. (2012), Stephan et al. (2015), Sud et al. (2009), Townsend and Hart (2008), Urbano et al. (2010), Weber and Kratzer (2013), Wilson and Post (2013), and Zahra et al. (2009)
How social entrepreneurs interplay with their context?
Which are the main antecedent factors in the social entrepreneurial process?
The previously mentioned lack of consensus regarding the definition of the main parameters that configure the paradigm of social entrepreneurship (e.g. social entrepreneur, social enterprise or social innovation) is a limitation for the development of future research and in particular for the development of empirical studies (Bacq and Janssen 2011; Choi and Majumdar 2014; Mair and Marti 2006; Short et al. 2009).
In another stream of research, a number of studies have been dedicated to describing the similarities and distinctions between social and commercial entrepreneurs (Austin et al. 2006; Gimmon and Spiro 2013; Spear 2006; Williams and Nadin 2012), non-profit enterprises (Fowler 2000; Sastre-Castillo et al. 2015) and corporate social responsibility (Seelos and Mair 2005; Sharir and Lerner 2006). As Austin et al. (2006) noted, the main difference between social and commercial entrepreneurship has to do with purpose, or what the enterprise is trying to maximize. The study undertaken by Bacq et al. (2013), in which social and commercial entrepreneurship is compared in Belgium and the Netherlands, highlights that social entrepreneurship organizations are younger when compared with commercials ones, as well as noting the infancy stage of the entrepreneurial process that they are in. Additionally, Bacq et al. (2013: 54) suggest that social entrepreneurs are less ambitious in terms of employment growth than commercial ones.
Thompson and Doherty (2006) note that social enterprises are distinctive from many non-profit organizations in their entrepreneurial approach to strategy, their innovation in the pursuit of social goals and their engagement in training. Moreover, social venturing is best understood more broadly. In this sense, Fowler (2000) produced the most complex social entrepreneurship typology to date, highlighting three broad categories of social entrepreneurial activities. In discussing these three models of social entrepreneurship, the author highlights the difference between the economic activities that simultaneously provide social benefits and those that do not (as in the third model), and notes that the former place more complex and stringent demands on an organization than the latter.
As in the social entrepreneurship area, another stream of research is concerned with building knowledge about how social opportunities are discovered, created and exploited (e.g. Corner and Ho 2010; Engelke et al. 2015; Gras and Mendoza-Abarca 2014; Ko and Liu 2015; Zahra et al. 2008). Weerawardena and Mort (2006) define the process of the identification and evaluation of social opportunities as a separate activity in which social entrepreneurs seek opportunities to create social value. Moreover, the authors conclude that this process is simultaneously influenced by different elements: social mission, organizational sustainability and context. In the same line, Dees (2001) suggests that the entrepreneurship components of social entrepreneurial activities include the recognition and pursuit of social opportunities to create social value. Furthermore, according to Mort et al. (2003: 82), social entrepreneurs have the “ability to recognise opportunities to create better social value for their clients”. Hence, social entrepreneurs are motivated to address the issue that markets value social improvements and public goods ineffectively (Austin et al. 2006).
Finally, another key area of interest in social entrepreneurship research focuses on environmental sustainability (e.g. Di Domenico et al. 2010). As presented in the entrepreneurship field, new (social) organizations are affected by specific factors often associated with cultural, economic or market factors (Gnyawali and Fogel 1994). Neck et al. (2009) raise this issue in social entrepreneurship inquiry. In a discussion of the complex, shifting and often unpredictable environment that social entrepreneurs face in trying to fulfil their social and economic goals simultaneously. Moreover, Amin et al. (2002) and Muñoz and Kibler (2015) stress the idea that cross-country differences in social entrepreneurial activities reflect the differences in welfare systems and in political and institutional contexts. The research in this domain focuses on the context in which social ventures operate which has a direct bearing on their ability to meet the dual target of creating social value while also creating a business model that is financially stable.
In this way, several researchers suggest that institutional environmental is very important for the emergence and implementation of social actions (e.g. Mair and Marti 2009; Nicholls 2010b; Nissan et al. 2012; Stephan et al. 2015; Urbano et al. 2010). For example, social entrepreneurs typically address areas of unsatisfied social needs or the creation of new social opportunities that the public or private sectors have failed to address (Corner and Ho 2010). Thereby, social opportunities and institutional factors are related (Zahra et al. 2008). Furthermore, the lack of finance available for the development of social capital is one of the main constraints that social entrepreneurs encounter in fulfilling their social mission (Sharir and Lerner 2006).
2.2.2 Methodological Issues on Social Entrepreneurship Research
Although social entrepreneurship is a new field of inquiry, the literature on social issues in the business, economics and management areas has in the last 10 years paid increasing attention to social entrepreneurship. With regard to the evolution of such publications, as it was mentioned before, since 2006 articles and special issues on social entrepreneurship have appeared in scholarly journals (within Journal Citation Reports2), such as the Journal of World Business (2006), Journal of Business Venturing (2009), Entrepreneurship Theory and Practice (2010), Entrepreneurship & Regional Development (2011), Academy of Management Learning & Education (2012) and International Small Business Journal (2013), among others.
Despite this growing attention to social entrepreneurial activities as a scholarly field of research, it is still in a stage of infancy (Short et al. 2009). The research in the past decade has been dedicated primarily to establishing a conceptual foundation, which has resulted in a considerable stream of conceptual papers. According to our review, most publications consist of a conceptual setup with an intuitive touch and aim to define the key constructs and explore why and how these constructs are related.
Main traits of empirical studies (%)
Type of research
Method of qualitative articles
Method of quantitative articles
Case study sample size
More than 10 cases
It is noteworthy that much of the literature on social entrepreneurship lacks substantial empirical analysis. The theoretical debate that has emerged during the last few years due to the growing interest in the topic has undoubtedly contributed to a better understanding of the phenomenon. In conclusion, these findings confirm the stage of infancy of social entrepreneurship research. The findings can be summarized as follows: there are a limited number of empirical studies with a limited quantitative research approach, mainly of an exploratory type; rigorous hypothesis testing is lacking; little variety of research design is applied; and the research is based on relatively small sample sizes. The case studies may be accurate and specific, but they often lack the ability to offer generalizable findings. Additionally, our data indicate that social entrepreneurship research needs to incorporate specific hypotheses to be tested and the use of multivariate research methods.
2.3 Social Entrepreneurship and Institutional Economics
As it was mentioned before both formal and informal factors could influence entrepreneurship (e.g. Aidis 2005; Aidis et al. 2008; Aparicio et al. 2016; Thornton et al. 2011; Urbano et al. 2011; Urbano and Alvarez 2014; Veciana and Urbano 2008; Welter 2005) and particularly social entrepreneurship (Desa 2012; Dorado and Ventresca 2013; Mair and Marti 2006, 2009; McMullen 2011; Nicholls 2010b; Townsend and Hart 2008; Urbano et al. 2010). While formal institutions provide the legal framework and create new opportunities for social entrepreneurs, informal institutions legitimate the social entrepreneurial activities within a society, fostering a positive attitude towards this phenomenon. In this study, formal institutions are public spending, access to funding, education and minimum capital requirements. And informal institutions are self-perceived capabilities, entrepreneurial attitudes, social orientation and innovativeness. However, we are well aware that the process of new social venture creation is highly complex and that no one institutional factor can determine the evolution of this process.
2.3.1 Public Spending
Regarding the formal institutions, we highlight the importance of public spending. In this sense, in many countries, both developed and developing, there has been a systematic retreat by governments from the provision of public goods in the face of new political ideologies that stress citizen self-sufficiency and give primacy to market-driven models of welfare (Leadbeater 1997). As a result, in many territories, the “supply side” of the resources available for public goods has remained static or diminished (Sharir and Lerner 2006). In the same way, Cornwall (1998) notes that in countries where the provision of social services (health, cultural, leisure and welfare) is scarce and mainly undertaken by public institutions, the emergence of social entrepreneurs is significant. However, Friedman and Desivilya (2010) argue that the work carried out by governments and social entrepreneurs is complementary, due to the public sector having been able to mobilize massive efforts in several periods, but having been unable to choose models that incorporate and maintain their efficiency and effectiveness. For their part, social entrepreneurs’ efforts provide efficient and effective models in performance. Despite this, the recent empirical evidence indicates the negative impact of the percentage of public expenditure on the emergence of new social enterprises (Alvord et al. 2004; Austin et al. 2006; Cornwall 1998; Harris 2009). Therefore, it is expected that low levels of public spending increase the rate of social entrepreneurial activities, thus the following proposition is advanced:
P1: Public spending has a negative influence on social entrepreneurial activity.
2.3.2 Access to Funding
The availability of capital is important to social entrepreneurs as it lays the foundation for the social organization (Grimes 2010). Studies conducted in several countries show that individuals are sensitive to capital constraints in their decision to take entrepreneurial positions—in particular, self-employment (Blanchflower and Oswald 1998; Holtz-Eakin et al. 1994). In the present literature, there is no difference between the importance of access to funding to social entrepreneurs and the importance to commercial counterparts (Alvord et al. 2004). However, the literature on the emergence and development of social entrepreneurial activities highlights the existence of specific barriers relating to the financial constraints that social entrepreneurs must cope with in order to carry out their social mission (Bacq and Janssen 2011; Certo and Miller 2008; Di Domenico et al. 2010). Hence, many non-profit organizations see social enterprise as a way to reduce their dependence on charitable donations and grants, while others view the business itself as the vehicle for social change (Borzaga and Defourny 2001). Therefore, as mentioned in relation to entrepreneurship firms with economics goals (e.g. Gnyawali and Fogel 1994), we suggest that a reduction of the barriers to access to finance, with greater access to credit, will positively promote the emergence of new social enterprise projects, thus reducing the risks of budget uncertainty and dependence on public grants or aid. Therefore, the following proposition is suggested:
P2: Access to funding has a positive influence on social entrepreneurial activity.
The entrepreneurship literature states that people’s behaviour is usually guided by their knowledge and skills. Specifically, recent research studies show that, in general, higher levels of education have a positive effect on the probability of an individual creating a firm (Arenius and Minniti 2005; Davidsson and Honig 2003; Delmar and Davidsson 2000). Similarly, several authors in the social entrepreneurship field note that high levels of education are common denominators between the social environments. However, there is no evidence that this knowledge should focus on the field of business management (e.g. Nga and Shamuganathan 2010; Shaw and Carter 2007). In short, the background of social entrepreneurs is critical for triggering the desire to launch a social enterprise. Thus, this takes into account that individuals may be more inclined to make a decision to start a business if they believe they have the skills to carry out the activity successfully (Arenius and Minniti 2005; Chen et al. 1998; Davidsson and Honig 2003; Nga and Shamuganathan 2010), the following proposition is formulated:
P3: Education has a positive influence on social entrepreneurial activity.
2.3.4 Minimum Capital Requirements
Finally, the last formal institution that could influence social entrepreneurship is the minimum capital requirements. In this sense, potential, social and commercial entrepreneurs may be discouraged from starting a new initiative if many financial barriers face them. In fact, previous studies have reached the consensus that larger minimum capital requirements are detrimental to entrepreneurship (Dreher and Gassebner 2013). This is why some governments and institutions focus attention upon lowering the entry barriers to the formation of new firms, including cutting the statutory minimum capital (van Stel et al. 2007). As noted by Braun et al. (2013) and Becht et al. (2008), the amount of equity funding that owners must pay or promise to pay when they establish a firm leads to opportunity costs as well as increased financial constraints for entrepreneurs. Thus, the cost of starting a new business (capital requirements) used to be negatively correlated with the prevalence of entrepreneurship (Armour and Cumming 2008; Klapper et al. 2006). For these reason, we take into account in our model to study the relationship between social entrepreneurship and the institutional framework. Thus, these arguments suggest the following proposition:
P4: Minimum capital requirements have a negative influence on social entrepreneurial activity.
2.3.5 Self-Perceived Capabilities
Regarding to informal institutions, we start with the self-perceived capabilities which refer to the belief in one’s ability or competence to bring about intended results. This category is composed by several variables such as fear of failure, perception of entrepreneurial skills, opportunity to start-up, risk-taking and role model. According to previous literature, it is expected that a lack of this attribute could influence social entrepreneurial activities. In this sense, self-perceived capabilities are also an important factor explaining social entrepreneur participation (Mair et al. 2006; Thompson 2002). Harding and Cowling (2004) find that social entrepreneurs on average are less confident about their own skills to start a business than their commercial counterparts. Hence, if a country’s population possesses more entrepreneurial capabilities, it is likely to have a higher rate of entrepreneurship. Hence, we expect, in accordance with commercial entrepreneurship, a positive association between self-perceived capabilities and social entrepreneurship. Accordingly, the following is proposed:
P5: Self-perceived capabilities have a positive influence on social entrepreneurial activity.
2.3.6 Entrepreneurial Attitudes
Another informal institutional factor that could affect social entrepreneurship is the entrepreneurial attitudes which include: the entrepreneurial culture, entrepreneurial social image and the media impact. As noted by the OECD (2010), promoting entrepreneurial awareness and positive attitudes towards commercial and social entrepreneurship are high on the policy agenda of several economies. Their study suggests that the formation of different cultural values in different societies influences the decision to create new businesses (Bruton et al. 2010); therefore, not all societies foster entrepreneurial activity (social and commercial) with equal effectiveness. Shapero and Sokol (1982) observed how business formation rates vary from society to society. They argue that these differences occur due to different cultures holding different beliefs about the desirability and feasibility of beginning a new project or organization. Positive views on these measures can influence the willingness of individuals to become entrepreneurs. Consequently, this positive social image could foster more people to start new social organizations. However, it is important to note that differences in the sociocultural context may influence, among other things, the status and social recognition of social entrepreneurs, promoting or inhibiting entrepreneurial career choice (Jaén and Liñán 2013). Finally, another institutional factor that could affect social entrepreneurial activity relates to media attention paid to social entrepreneurs. Stories reported by the media can play a critical role in the processes that enable new businesses to emerge. Therefore, the intention to start a new social entrepreneurial project is underpinned by the perceptions society holds of entrepreneurs; consequently, if the media positively represents social entrepreneurship’s role in society it could foster more people to desire to become social entrepreneurs. This leads to the following proposition:
P6: Favourable entrepreneurial attitudes have a positive influence on social entrepreneurial activity.
2.3.7 Social Orientation
As has already been noted, the primacy of the social mission over all the other organizational objectives is the first key determinant of a potential social entrepreneurial venture (Dees 2001). Despite the differences between the various definitions of social entrepreneurship, there is agreement on the emphasis on the social mission as the reason for the emergence of a social enterprise. In this sense, the social orientation dimension includes being a member of a social organization, post-materialism values and altruism. In this sense, the social mission focus equates to the identification of an unmet social need or a new social value creation opportunity (Mair and Marti 2006). In this sense, Cornwall (1998) and Wallace (1999) define social entrepreneurs as entrepreneurs who take on the social responsibility to improve their communities. On the other hand, the current resurgence of social entrepreneurship is a renewal of spirit that promotes the foundations of the non-profit sector, is independent and is built by individuals who see it as their responsibility to act to ameliorate social problems (Mair et al. 2006). Thus, their involvement with the social sector allows social entrepreneurs to recognize new opportunities as well as to turn themselves into altruistic and more sensitive citizens who are dissatisfied with the status quo and are motivated to act with social responsibility (Corner and Ho 2010; Zahra et al. 2008). In sum, it is claimed that social attitudes represent an important informal factor in the social entrepreneurship process, affecting the perception of social ventures as a good way to achieve social missions. This results in the following proposition:
P7: Social orientation has a positive influence on social entrepreneurial activity.
According to Lumpkin and Dess (2001), the concept of innovativeness can be defined as the predisposition to engage in creativity and experimentation through the introduction of new products and services as well as new processes. The entrepreneurship literature suggests that entrepreneurs are more creative than others (Kirby 2004; Timmons 1989). Tend to think in non-conventional ways, challenge existing assumptions and are flexible and adaptable in their problem solving (Kirby 2004; Solomon and Winslow 1988). In the social entrepreneurship field, some authors (Chell et al. 2010; Mair and Marti 2006; Peredo and McLean 2006) noticed that due to the multidimensional origin of social problems, social entrepreneurs have various potential ways to exercise innovativeness tools or strategies to achieve their social mission. In particular, Alvord et al. (2004) note that scarce resources can also stimulate social entrepreneurs to become creative and think of better ways to tackle social problems, thus producing more innovativeness. Thus, we can regard innovativeness as an important dimension in the process of studying social entrepreneurship behaviour (Lepoutre et al. 2013; Lumpkin et al. 2013; Nga and Shamuganathan 2010). Accordingly, the following is proposed:
P8: Innovativeness has a positive influence on social entrepreneurial activity.
Social entrepreneurship is no longer just a topic within business studies or economics but is in many ways an academic discipline in its own right, with university courses, academic journals and specialist conferences acting as evidence to support this claim. The academics specializing in social entrepreneurship research come from a wide variety of perspectives and backgrounds; some have been entrepreneurs, policy-makers or advisors or they have been engaged in other forms of entrepreneurship practice.
In this chapter, we firstly explored and analysed the main social entrepreneurship research, and secondly, we studied the literature on this emerging field through the institutional lenses. To accomplish this objective we analysed articles included in Web of Science, as well as international journals and specialized books on the social entrepreneurship phenomenon.
The main findings confirmed that social entrepreneurship research is in its infancy stage and the boundaries of the paradigm remain fuzzy. After our exploratory analysis of social entrepreneurship inquiry, we conclude that in general there is a lack of empirical studies that use multivariate analysis, due to the vast amount of literature characterized as conceptual studies, and that fewer empirical researchers are focused on case study methodology. Moreover, these previous studies are based on small sample sizes, which limits the capability to generalize their results. However, the evolution of articles published about social entrepreneurship is ongoing, showing the interest of academia in this topic.
Future research could empirically corroborate institutional approach as a conceptual framework for social entrepreneurship, measuring the impact of formal and informal factors on social entrepreneurial activity. The study contributes theoretically for the development of the literature in the social entrepreneurship field, and empirically, for the design of policies to foster social entrepreneurial activity.
Web of Science (formerly ISI Web of Knowledge) is an online subscription-based scientific citation indexing service maintained by Thomson Reuters that provides a comprehensive citation search. This unified research platform serves for finding, analyzing and sharing information in the sciences, social sciences, arts and humanities.
Journal Citation Reports (JCR) is an annual publication by Thomson Reuters. It has been integrated with the Web of Science and provides information about academic journals in the sciences and social sciences, including impact factors. Currently, the JCR is based on citations compiled from the Science Citation Index Expanded and the Social Science Citation Index.
David Urbano acknowledges the financial support from projects ECO2013-44027-P (Spanish Ministry of Economy & Competitiveness) and 2014-SGR-1626 (Economy & Knowledge Department—Catalan Government–). Also, Sebastian Aparicio acknowledges financial support for Ph.D. studies from COLCIENCIAS Ph.D. Program Chapter 3 (617/2013) and Fundación ECSIM.
- Amin, A., Cameron, A., & Hudson, R. (2002). Placing the social economy. London: Routledge.Google Scholar
- Aparicio, S., Urbano, D., & Audretsch, D. (2016). Institutional factors, opportunity entrepreneurship and economic growth: Panel data evidence. Technological Forecasting and Social Change, 102, 45–61.Google Scholar
- Bornstein, D. (2004). How to change the world social entrepreneurs and the power of new ideas. New York: Oxford University Press.Google Scholar
- Bornstein, D., & Davis, S. (2010). Social entrepreneurship: What everyone needs to know. New York: Oxford University Press.Google Scholar
- Borzaga, C., & Defourny, J. (2001). The emergence of social enterprise. London: Routledge.Google Scholar
- Brooks, A. C. (2009). Social entrepreneurship: A modern approach to social value creation. Upper Saddle River: Pearson.Google Scholar
- Corner, P. D., & Ho, M. (2010). How opportunities develop in social entrepreneurship. Entrepreneurship: Theory and Practice, 34(4), 635–659.Google Scholar
- Cornwall, J. (1998). The entrepreneur as building block for community. Journal of Developmental Entrepreneurship, 3(2), 141–148.Google Scholar
- Dees, J. G. (2001). The meaning of “Social Entrepreneurship”. Comments and suggestions contributed from the Social Entrepreneurship Founders Working Group. Durham: Center for the Advancement of Social Entrepreneurship, Fuqua School of Business, Duke University. Retrieved from http://www.caseatduke.org/documents/dees_sedef.pdf
- Elkington, J., & Hartigan, P. (2008). The power of unreasonable people: How social entrepreneurs create markets that change the world. Cambridge: Harvard Business School Press.Google Scholar
- Gnyawali, D. R., & Fogel, D. S. (1994). Environments for entrepreneurship development: Key dimensions and research implications. Entrepreneurship Theory and Practice, 18(4), 43–62.Google Scholar
- Harding, R., & Cowling, M. (2004). Social entrepreneurship monitor GEM UK. London: London Business School and The Work Foundation.Google Scholar
- Ladeira, F. M. B., & Machado, H. V. (2013). Social entrepreneurship: A reflection for adopting public policies that support the third sector in Brazil. Journal of Technology Management and Innovation, 8(2), 188–196.Google Scholar
- Leadbeater, C. (1997). The rise of the social entrepreneur. London: Demos.Google Scholar
- Light, P. (2008). The search for social entrepreneurship. Washington: Brookings.Google Scholar
- McMullen, J. S. (2011). Delineating the domain of development entrepreneurship: A market-based Approach to facilitating inclusive economic growth. Entrepreneurship: Theory and Practice, 35(1), 185–193.Google Scholar
- Nicholls, A. (2006). Social entrepreneurship: New models of sustainable social change. New York: Oxford University Press.Google Scholar
- OECD. (2010). Social entrepreneurship and social innovation. In SMEs, entrepreneurship and innovation. OECD studies on SMEs and entrepreneurship (pp. 185–215). Paris: OECD.Google Scholar
- Roy, M. J., McHugh, N., Huckfield, L., Kay, A., & Donaldson, C. (2015). “The most supportive environment in the world”? Tracing the development of an institutional ‘ecosystem’ for social enterprise. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 26(3), 777–800.CrossRefGoogle Scholar
- Shapero, A., & Sokol, L. (1982). The social dimensions of entrepreneurship. In C. A. Kent, D. L. Sexton, & K. H. Vesper (Eds.), Encyclopedia of entrepreneurship (pp. 72–90). Prentice-Hall: Englewood Cliffs.Google Scholar
- Smallbone, D., Evans, M., Ekanem, I., & Butters, S. (2001). Researching social enterprise: Final report to the small business service. London: Centre for Enterprise and Economic Development Research, Middlesex University Business School, Middlesex University.Google Scholar
- Timmons, J. A. (1989). The entrepreneurial mind. Andover, MA: Brick House.Google Scholar
- Urbano, D., & Aparicio, S. (2016). Entrepreneurship capital types and economic growth: International evidence. Technological Forecasting and Social Change, 102, 34–44.Google Scholar
- Wallace, S. L. (1999). Social entrepreneurship: The role of social purpose enterprises in facilitating community economic development. Journal of Developmental Entrepreneurship, 4(2), 153–174.Google Scholar
- Welter, F. (2005). Entrepreneurial behavior in differing environments. In D. B. Audretsch, H. Grimm, & C. W. Wessner (Eds.), Local heroes in the global village globalization and the new entrepreneurship policies. International studies in entrepreneurship (pp. 93–112). New York: Springer.Google Scholar
- Wilson, F., & Post, J. E. (2013). Business models for people, planet (& profits): Exploring the phenomena of social business, a market-based approach to social value creation. Small Business Economics, 49(1), 95–122.Google Scholar
- Yunus, M., & Weber, K. (2008). Creating a world without poverty: Social business and the future of capitalism. New York: Public Affairs.Google Scholar