Economic Role and Behavior of Social Entrepeneurs

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LITERATURE REVIEW
ECONOMIC PERSPECTIVE Even with the growing academic interest, the field lacks a conceptual understanding of the economic role and behavior of social entrepreneurs (Dacin et al. 2010). To move forward, well defined theories are needed to explain social entrepreneurships’ significance in the economic system (Pfeffer, 1993). In addition, externalities need to be internalized by social entrepreneurs in order to achieve optimal economic outcomes. Santos (2012) suggests that social entrepreneurship is the distributed mechanism that ensures that externalities are continuously being identified in the economic system.
Social Entrepreneurs play a significant economic role in cases where externalities exist. Social entrepreneurs are driven by and act on externalities, specifically positive externalities. Externalities arise when economic activity creates an impact that extends beyond the objective function of the agents developing the activity (Rangan et al. 2006). When positive externalities exist the outcome is often a shortage of resources such as education or employment. This under-provision of goods creates more value for society than value created for the recipient of the resources. The literature implies that the distinctive domain of social entrepreneurship consists of the social entrepreneur addressing neglected problems with positive externalities (Santos, 2012).
SOCIAL ENTREPRENUERSHIP
Social entrepreneurs are defined as individuals who start up and lead new organizations or programs that are dedicated to mitigating or eliminating a social problem, deploying change strategies that differ from those that have been used to address the pr...

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...ers to the advance of organizational science: Paradigm development as a dependent variable. Academy of Management Review, 18:599-620.

Rangan, S., Samii, R., & Van Wassenhove, L.N. (2006). Constructive partnerships: When alliances between private firms and public actors can enable creative strategies. Academy of Manament Review, 31:738.

Santos F. (2012) A Positive Theory of Social Entrepreneurship, Journal of Business Ethics: 111:335-351.

Short, J.C., Moss, T. W., &Lumpin, G.T. (2009). Research in social entrepreneurship: Past contributions and future opportunities. Strategic Entrepreneurship Journal, 3:161-194.

Sorenson, E. and Torfing, J., 2003. Network politics, political capital and democracy. International journal of public administration, 26: 609-634.

Wernerfelt, B., 1984. A resource-based view of the firm. Strategic management journal, 5:171- 180

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