Social Entrepreneurship: Addressing Inequality and Externalities
This paper traces the development of social entrepreneurship from its origins in the 1970s through to its contemporary applications. It examines the concept's foundational definitions, the role of organizations such as Ashoka in supporting social entrepreneurs, and the relationship between social entrepreneurship and broader movements such as corporate social responsibility. The paper then analyzes key challenges that social entrepreneurship seeks to address, including environmental and economic externalities and social inequality. It applies these concepts to a concrete example — food access disparities in minority and low-income communities — demonstrating how social entrepreneurial models such as urban farming and locally sourced restaurants can serve as viable, sustainable responses to systemic social problems.
- Development of Social Entrepreneurialism: Origins, definitions, and Ashoka's founding role
- Corporate Social Responsibility: CSR frameworks, stakeholders, and financial performance links
- Externalities: Economic externalities, pollution, and social costs
- Social Inequality: Inequality metrics, GPI, and triple bottom line limitations
- Social Entrepreneurship and Food: Food deserts, obesity disparities, and community solutions
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What makes this paper effective
- The paper moves logically from theory to application, grounding abstract concepts like externalities and CSR in concrete real-world examples such as the Foxconn worker suicides and the BP oil spill.
- It synthesizes a wide range of academic and institutional sources — from economic theory to public health research — to build a multidisciplinary argument about social entrepreneurship's scope and purpose.
- The concluding section successfully applies the framework developed throughout the paper to a specific social problem (food access and obesity in minority communities), demonstrating practical relevance.
Key academic technique demonstrated
The paper demonstrates effective use of a comparative definitional table (Table 1) to survey competing scholarly definitions before establishing a working synthesis. This technique allows the writer to acknowledge disciplinary disagreement while still proceeding with a coherent analytical framework — a hallmark of strong undergraduate literature-based argumentation.
Structure breakdown
The paper opens with a brief overview of its structure, then proceeds through five thematic sections: the history and definitions of social entrepreneurship, the CSR movement as a parallel trend, economic externalities and their social costs, social inequality and alternative performance metrics, and a practical case study focused on food access. Each section builds on the last, culminating in a concrete policy recommendation grounded in social entrepreneurial theory.
Development of Social Entrepreneurialism
Social entrepreneurship was introduced in the 1970s to address the issue of social sustainability. The term "social entrepreneur" was first mentioned in 1972 by Joseph Banks in his seminal work The Sociology of Social Movements, where he used it to describe the need to apply managerial skills to address social problems as well as business challenges (El Ebrashi, 2013). The concept of social entrepreneurship evolved as part of the broader entrepreneurship literature, despite the fact that most of that literature focused on the creation of new ventures to produce profits. However, forming new ventures within the social entrepreneurship framework was not oriented toward profit-making. Instead, it replaced the notion of individual value creation — the creation of wealth — with a more holistic concept of value creation that included a broader set of stakeholders, such as those at the community level and community development goals.
Multiple scholars and institutions have proposed definitions of the social entrepreneur. The table below summarizes several key perspectives:
Bornstein (1998) described a social entrepreneur as "a path breaker with a powerful new idea who combines visionary and real-world problem-solving creativity, has a strong ethical fiber, and is totally possessed by his or her vision for change" — emphasizing mission leadership and persistence. Thompson et al. (2000) defined social entrepreneurs as people who identify unmet needs that the state welfare system cannot or will not meet and who gather the resources necessary to "make a difference," stressing their role as emotionally engaged social value creators. Dees (1998) characterized them as change agents who adopt a mission to create and sustain social value, relentlessly pursue new opportunities, engage in continuous innovation, act boldly without being limited by available resources, and maintain a heightened sense of accountability to the constituencies they serve. Brinckerhoff (2009) offered a simpler formulation: a social entrepreneur is someone who takes reasonable risk on behalf of the people their organization serves. Leadbeater (1997) highlighted their role as leaders, storytellers, people managers, visionary opportunists, and alliance builders who organize ventures to make social change. Zahra et al. (2008) defined social entrepreneurship as encompassing activities and processes undertaken to discover, define, and exploit opportunities to enhance social wealth by creating new ventures or managing existing organizations in an innovative manner. Finally, Ashoka (2012) described social entrepreneurs as individuals with innovative solutions to society's most pressing social problems who are both visionaries and ultimate realists, concerned above all with the practical implementation of their vision (Abu-Saifan, 2012).
Entrepreneurship has also been described as the process by which an entrepreneur discovers a fit between certain needs and resources, establishes an innovative venture, works on the venture's growth, pursues further opportunities to continuously innovate, and produces sensible outcomes (El Ebrashi, 2013). The outcomes of social entrepreneurship differ from those of traditional entrepreneurship, and the measurement of those outcomes also differs. Social entrepreneurs are known to focus on market failures — a function that resembles that of traditional entrepreneurs — but these market failures are not only related to price disequilibria or the inability of some people to access certain products or services. Rather, they address issues related to externalities, public goods, and distributional equity (El Ebrashi, 2013).
These concepts began to receive institutional support in the 1980s with the establishment of Ashoka, the first organization in the world dedicated to supporting social entrepreneurs. Ashoka is now the largest network of social entrepreneurs worldwide, with nearly 3,000 Ashoka Fellows in 70 countries putting their system-changing ideas into practice on a global scale (Ashoka, n.d.). Its mission is "to support social entrepreneurs who are leading and collaborating with changemakers, in a team of teams model that addresses the fluidity of a rapidly evolving society. Ashoka believes that anyone can learn and apply the critical skills of empathy, teamwork, leadership, and changemaking to be successful in the modern world" (Ashoka, n.d.). Ashoka has been one of the pioneers in developing the social entrepreneur concept and creating a network to support these entrepreneurs.
Corporate Social Responsibility
Many of the concerns about how capitalism can disadvantage certain segments of society have also manifested through more mainstream channels in the business world. The term "social innovation" was described in the work of Drucker (1990), who wrote about the need to apply management practices in non-profit organizations to increase the efficiency and effectiveness of producing social good (El Ebrashi, 2013). Furthermore, some of the world's largest corporations have become the targets of activist groups and concerned citizens regarding their social and environmental performance, which has shifted corporate focus from purely financial metrics toward broader measures of accountability. In response to growing concerns about business ethics and sustainable practices, many new frameworks have been developed to incorporate these factors into organizational narratives.
In response to growing consumer expectations and governmental regulations, many corporations now include alternative measures of performance alongside their primary financial objectives. Much of the literature groups social and ecological performance concerns together in the concept known as corporate social responsibility (CSR). The definition of CSR is broad and all-encompassing; it can be thought of as a measure of how well organizations meet the primary objectives of their immediate stakeholders as well as an extended set of relevant stakeholders, society, and the environment in general (Ecchia et al., 2007). CSR initiatives can focus on the local community while others might tackle global issues or social challenges in underdeveloped nations.
Much of the CSR trend is being driven by globalization and the massive international growth of corporations, as well as by advances in technology that allow consumers to be more aware of the operations responsible for the products they buy. Consumers can now research a corporation's CSR performance from their smartphones while making purchasing decisions in-store. Researchers have tried to determine how CSR performance influences primary financial performance. One such study developed a framework by considering the salience of stakeholders, their perceptions of the CSR effort, and their collective ability to impact a corporation's financial performance (CFP) (Peloza & Papania, 2008).
There is growing evidence that broadening the category of stakeholders and their objectives can benefit organizations, including their financial performance. However, such relationships are far from clear, and a significant body of conflicting evidence suggests that socially responsible companies are actually valued less than control samples in longitudinal market studies (Becchetti & Ciciretti, 2009). Despite the absence of a general correlation, many indirect benefits may accrue to organizations, including savings from operational costs, a stronger corporate image, increased ability to attract and retain qualified staff, better relations with government, sharper anticipation and management of risk, and enhanced capacity for learning and innovation (Nwaneri, 2015).
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