Social entrepreneurship: an overview of the current state of research.

AuthorDanko, Adriana

    The 2006 Nobel Peace Prize was awarded to Muhammad Yunus, an exceptional economist and entrepreneur. Yunus recognized the plight of his fellow countrymen in Bangladesh: in spite of their hard work, they still were not earning sufficient wages and continued to live in poverty. Yunus believed that such poverty was a consequence of a lack of access to the resources required to identify and exploit opportunities, particularly financial resources. To redress the imbalance of wealth distribution, something recognized as a root cause of poverty (Neck et al., 2008), Yunus provided small sums of credit, 'microfinance', as a mechanism to help gain access to opportunity exploitation (Brooks, 2009). Specifically, Yunus believed that if microfinance was used to support the initiation of sustainable social enterprises which sought to address social, environmental and other symptoms created by the root causes of poverty and lack of access to opportunities, the capitalist market structure could be broadened. This in turn would create opportunities for market exploitation that would be available to a more diverse range of entrepreneurs, including social entrepreneurs (Bornstein, 2005). Convinced by this argument, Yunus established the Grameen Bank in 1983 and became a social entrepreneur himself. His bank, which provides microcredit to socially disadvantaged individuals lacking collateral, has revolutionized the credit industry and initiated international investment growth in the microcredit industry, encouraging the phenomenon of social enterprise on a global scale.

    Social entrepreneurship is a phenomenon widely recognized for its ability to create social value and societal change. It intrigues more and more academic researchers as well as policy makers. There is growing acknowledgement of the importance of social entrepreneurship as a facilitator of democratic processes (Lundstrbm and Svedberg, 2003). The societal aim is the core of social entrepreneurship (Elkington and Hartigan, 2008). The term 'social enterprise' first emerged in the 1980s and since then has experienced significant, increasing global growth. Social enterprises are now recognized as vibrant ventures boosting the economic, social, environmental and cultural wealth of most economies, and are supported by the governments of most developed and developing economies (Ashoka, 2006). For example, in the UK where a Comprehensive Sending Review slashed the budgets of various government departments by up to 25%, resources supporting social enterprises have been ring-fenced and witnessed increases. The Global Entrepreneurship Monitor (e.g. Bosma and Levie, 2010) provides further indications of the strength of the social enterprise sector.

    Despite the significant growth of social enterprises, academic research on this growing phenomenon is at an early but growing stage (Thompson et al., 2000). Since the publication of The Rise of the Social Entrepreneur (Leadbeater, 1997), the term social entrepreneurship has been the focus of a growing field of research, and is becoming increasingly well-anchored within the entrepreneurship literature (Certo and Miller, 2008; Zahra et al., 2009). Compared to the traditional for-profit commercial entrepreneurship, however, our understanding of social entrepreneurship is still limited. The growing importance of this field is evidenced by the increasing numbers of calls for papers on the topic of social entrepreneurship by prestigious entrepreneurship journals. This suggests the timeliness of a comprehensive review of the emerging yet growing literature on the state-of-the-art of research on social entrepreneurship. This paper seeks to present this review, as well as identify research gaps and a future research agenda. The paper presents an extensive analysis of papers on the topic of social entrepreneurs and social entrepreneurship published in leading scientific journals over the past 20 years (1991-2010), such as Entrepreneurship: Theory and Practice or Strategic Entrepreneurship Journal. Existing empirical research on the topic is identified and discussed.


    The term social entrepreneurship has seen increasing use since the late 1980s both in the media and academic literature (Emerson and Twerksy, 1996). Since 1997 the term has experienced extensive application in entrepreneurship literature (Leadbeater, 1997). Despite this, reflecting debates within the wider entrepreneurship discourse, there are multiple definitions and interpretations of what social entrepreneurship is. No universally acceptable definition of them has emerged (Smallbone et al., 2001). A review of the literature suggests however that most definitions fall into one of three categories. First, there are definitions which emphasize the personality of the entrepreneur and make clear distinctions between social and commercial entrepreneurs (Tan et al., 2003; Roberts and Woods, 2006; Sharir and Lerner, 2006). Second are definitions which describe social entrepreneurship as a process that innovatively capitalizes on and combines resources with the goal of affecting sustainable social change (OECD, 1999; Thompson et al., 2000; Boschee and McClurg, 2003; Alter, 2004; Alvord et al., 2004; Bartlett, 2004; Pariyar and Ward, 2006). A third branch of definitions combines each of these perspectives by including the entrepreneur's personality and the process of social entrepreneurship in one definition (Sullivan Mort et al., 2003; Roberts and Woods, 2006).

    Alternative definitions of social entrepreneurship have sought to address a variety of issues such as the nature of innovation, leadership characteristics (King and Roberts, 1987), and how social entrepreneurs perceive social accountability (Cornwall, 1998). Table 1 shows the most important popular definitions, identifying the sector in which they are based and the researchers involved.

    2.1 Person

    The latter half of the 1990s witnessed the introduction of the term 'social entrepreneur' within the academic literature. While there is no generally accepted characterization of this person, the literature discusses a range of different perspectives relating to the social entrepreneur. Such individuals are regarded as a 'special form' of entrepreneur (Meyskens, 2008; Steinerowski et al., 2008) with a focus more on the mission and desire to promote and achieve social change (James, 2001; Dees, 2001). The characteristics of social entrepreneurs and how these are distinct from commercial entrepreneurs has also been considered (Prabhu, 1999; Johnson, 2000). Finally, some authors have sought to describe the individual attributes of social entrepreneurs without providing a comprehensive definition of what or who they are (De Leeuw, 1999; Deakins and Freel, 2003; Pariyar and Ward, 2006; Brooks, 2009).

    Steinerowski et al. (2008) have categorized social entrepreneurs as similar to commercial entrepreneurs and support this by describing the social entrepreneur as entrepreneurially thinking, but without a necessary for-profit orientation. Meyskens (2008) agrees that there are similarities in the processes by which both social and commercial entrepreneurs draw upon various forms of capital to exploit opportunities. Marshall (Marshall, 2011) is even convinced that it is possible to seek social change while pursuing monetary gains at the same time. Nevertheless, in contrast to the classical commercial entrepreneur, James (2001) notes how social entrepreneurs first and foremost recognize social opportunities. Here, he regards the promotion of social capital and its positive effects on social change as the central focus of social entrepreneurs. Dees (2001) shares this perspective, and expands upon it by describing the social entrepreneur as a change agent within the social sector. Dees (2001) also sees the social entrepreneur as an individual who accepts the mission of creating social change. This person is able to recognize the opportunities to carry out the goal of his/her social mission. In their characterizations of social entrepreneurs, both Prabhu (1999) and Johnson (2000) incorporate the social aspect as a motivator, as well as the entrepreneurial aspect of their actions. According to Prabhu (1999), social entrepreneurs obtain inspiration and direction from their Weltanschauung as they apply appropriate strategies for the accomplishment of their particular mission. Johnson (2000) endorses this viewpoint, defining social entrepreneurs as people who manage or found innovative organizations or companies whose primary goal is social change and the progress of their clientel. Although some authors do not provide a specific definition of social entrepreneurs, they still mention their attributes. Brooks (2009) for example notes how social entrepreneurs have inherent personality features that cannot be influenced such as age and gender; and characteristics that can be obtained such as educational...

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