Social Entrepreneurship in Context: Identity Emergence and Legitimation

Community ecologists, who consider the interdependence among organizations of different forms (Hannan and Freeman, 1986), have argued that that legitimacy can flow between organizational forms if they are sufficiently related or proximate in cognitive space (Ruef, 2000). De alio legitimation, the process by which an established population can facilitate the institutionalization of an emergent population, greatly minimizes the time period needed for the new form to achieve a taken-for-granted status (Dobrev, 2001). While some studies have looked at how this process operates across populations of organizations within the commercial sector, no study has looked at how this legitimacy might travel between populations of organizations which vary in their goals, from those following a purely commercial mission to those organizations which follow a social mission, or social enterprises (Mair and Martí, 2006; Phills et al., 2008). Our study fills this gap. Utilizing data from three major social entrepreneurship foundations – Ashoka, Schwab, and Skoll – as well as from the Global Entrepreneurship Monitor, we study the emergence of social entrepreneurship relative to commercial entrepreneurship in three countries: Brazil, Mexico, and India. We show that there is a relationship between the traditional commercial entrepreneurship and the growth of social entrepreneurship. However, varying institutional environments between countries impacts the extent to which social entrepreneurship and commercial entrepreneurship co-evolve