Research Objectives and Main Contributions

Overall, taking into account the preceding considerations, the main objective of this thesis is to analyze the institutional factors (formal and informal institutions) that determine social entrepreneurship in developing countries, applying the institutional economics, in particular the contributions of North (1990, 2005). In this regard, this thesis places particular emphasis on different types of entrepreneurship (social and commercial entrepreneurship) and countries’ development measures (developing and developed countries) as well as on specific contexts.

20 The specific objectives of the research are outlined below, with each specific objective corresponding to a different research phase:

Phase 1) To analyze the content and theoretical and methodological evolution of the research in the field of social entrepreneurship that uses the institutional approach as a conceptual framework (Chapter 2).

Phase 2) To determine which institutional factors (formal and informal institutions) generate the probability of being a social or commercial entrepreneur in developing countries, using institutional theory (Chapter 3).

Phase 3) To recognize which sociocultural factors (informal institutions) generate the probability of being a social or commercial entrepreneur in developing and developed countries, considering the comparison between during the financial crisis and after it (Chapter 4).

Phase 4) To develop a pioneering version of an integrated model of social entrepreneurial satisfaction and then to test it empirically in a developing country (Mexico). This study allows us to analyze the relationship that exists between the support of formal and informal institutions, the desire to be a social entrepreneur in a developing countries, and the satisfaction of a social entrepreneur; therefore, this response to social entrepreneurship literature demands that their predictive validity be improved under the institutional economics (Chapter 5).

The contribution of this research can be explained from three different but complementary points of view: entrepreneurial, academic, governmental and societal views.

The objectives established above address some areas explored in social entrepreneurship research, which may generate further knowledge for the policy debate and scholarly discussion. In particular, we present some existing gaps that create the opportunity to continue investigating the social entrepreneurship phenomenon. In this sense, some explanations of each specific goal are provided.

Regarding the academic realm, there is a lack of studies which analyze both formal and informal institutional factors as key elements of social entrepreneurial activities (Saebi et al., 2019).

Despite the existence of studies which have dealt with the analysis of the context in which social entrepreneurs perform, the majority have done so only in a fragmented and descriptive way. A recent literature analysis is needed to look at and comprehend the trends in the area. By applying a systemic literature review, it is possible to identify what previous researchers have defined as possible pathways to keep studying. Therefore, the first specific goal (Chapter 2) explores the content and

21 evolution of both the relationships between institutional economics and social entrepreneurship, and how the latter is linked to developing countries. The literature analysis enables observation of the number of authors dealing with these topics, the journals publishing related works, and the research level, methods, and most accurate frameworks to support the empirical exercises. In the same way, this allows for the discussion of future research lines, academic programs, public policy, and managerial implications.

Despite efforts to understand entrepreneurship, there is limited solid evidence about the aspects of social and commercial entrepreneurship and how the institutional factors influence the emergence of social entrepreneurial activities (Urbano et al., 2010). In this regard, the second specific goal aims to examine which institutional factors increase the probability of being a social or commercial entrepreneur in developing countries (Chapter 3). To this end, institutional economics is used as a theoretical framework, which is suggested to be the most accurate one, according to the previous chapter. Hence, we will analyze formal and informal institutional factors that determine the possibility of making the decision to become a social entrepreneur. Along the same lines, this thesis specifically analyzes informal institutions (sociocultural factors) that influence an individual's decision to become a social or commercial entrepreneur and how these factors are debated in developing and developed countries (Chapter 4). This exploration allows us to compare the performance of institutions during a period of financial crisis and after the crisis. Complementary to the previous specific objective, which posits that sociocultural factors influence a social entrepreneur, it is possible to provide evidence for how this may differ between developed and developing countries, and thus, how it may serve to discuss policy implications depending on each country's stage of development.

It is important to note that chapters 3 and 4 on being analyzed with the same theoretical framework and the same technique (Logit regression, marginal effects (mfx)) may seem similar, but these two chapters examine different institutional factors. Concerning chapter 3, it shows that the higher the level of education (formal institution), increased the probability of being a social entrepreneur. Identifies that when personal values and entrepreneurial skills are linked, these increase the chance of being a commercial entrepreneur. This analysis was conducted in the environment of developing countries. This chapter was already published as a chapter of the scientific research book called: Handbook of Research on Smart Territories and Entrepreneurial Ecosystems for Social Innovation and Sustainable Growth.

On the other hand, chapter 4 explains the influence of socio-cultural factors (informal institutions) on social and commercial entrepreneurs, comparing the context of developing and

22 developed countries. It is a priority to highlight that this chapter shows how each of these institutions plays a different role within a period of global financial crisis (2009) and after crisis (2015). Likewise, how these institutions affect entrepreneurs differently in countries according to their income level.

These results are relevant today, as they can support the development of policies that rescue economies through the promotion of social and commercial entrepreneurship, causing economic growth and social benefit.

Another coincidence we found between chapters 3 and 4, is that both use the Global Entrepreneurship Monitor (GEM) database. As mentioned above, chapter 3 uses GEM 2009 and chapter 4 discusses GEM 2009 and 2015. According to Lepoutre, et al., (2013), the GEM database is a multi-country initiative to facilitate cross-country comparison of entrepreneurial activity by using the same measurement approach in all countries involved in the survey (Reynolds et al. 2005).

This initiative started in 1997, and since then, GEM has expanded to over 80 participating countries in the last decade. Each year GEM surveys representative population samples of at least 2,000 randomly selected adults in each participating country (Lepoutre et al., 2013). From each individual interviewed in the GEM sample, records are collected socio-demographic. Once collected, the data is weighted to reflect the national population and harmonized with the other countries. GEM is acknowledged to be the best source of entrepreneurship data in the world and utilized in research published in leading academic journals. In 2009, over 150,000 individuals in 49 countries were surveyed and in 2015, over 181,000 individuals in 60 countries were surveyed. This thesis uses these two databases, as they integrate the special topic on social entrepreneurs.

To screen the surveyed population for social entrepreneurial activity, several questions were added that probed interviewees on their involvement in organizations with a particular social mission.

To this effect, two approaches were used: explicit self-identification and goal-based classification.

Through asking an introductory question, the respondents said if they self-identified or their goals as being involved in an organization with a social mission. The question was: Are you alone or with others, currently trying to start or currently owning and managing any activity, organization, or initiative that has a particular social, environmental, or community objective? This might include providing services or training to socially deprived or disabled persons, using profits for socially oriented purposes, organizing self-help groups for community action, among others. As of yet, GEM is the only large-scale database on social entrepreneurship.

The GEM database for the years 2009 and 2015 has a broad vision of social and commercial entrepreneurship. It includes companies with purely social and environmental objectives, as well as

23 hybrids. This is the generally accepted notion that social entrepreneurship is not limited to a specific legal form (Mair & Marti, 2006).

Chapters 3 and 4 analyze the principal GEM measure used, which is the total early-stage entrepreneurial activity (TEA), in social and commercial entrepreneurs. TEA gathers the information of the adult population (from 18 to 64 years old) that participates in the activity of business creation.

As such, TEA includes nascent entrepreneurs and young business owners. The TEA index has high validity and reliability (Reynolds et al., 2005). Respondents who answered that their social entrepreneurial activity was the same as their commercial entrepreneurial activity were classified as social entrepreneurs (Hoogendoorn, 2016).

The next specific objective aims to analyze other factors that can be predictive in the process of social entrepreneurship, such as the desire to be a social entrepreneur, and the factors that influence the satisfaction of the social entrepreneur. They are analyzed with an institutional focus, identifying the relationships that exist and their significance (Chapter 5). This investigation contributes to answering the call for more quantitative research. Quantitative studies centered on the analysis of institutional factors as determinants of social entrepreneurship across countries are noticeably absent.

In this sense, the necessity of empirical studies suggests new research opportunities. Moreover, the exploration extends our current knowledge of social entrepreneurial activities by comparing social entrepreneurship organizations with their commercial counterparts.

This premise is based on the knowledge of institutional factors, both formal and informal, which surround social entrepreneurial activity and which will serve for the design of governmental policies. An understanding of what causes some countries or regions to have more social entrepreneurial activity than others is of particular relevance for policymakers. Thus, the existence of support programs suitable for the needs of new social entrepreneurs can positively affect social entrepreneurial activities.

Although literature exists that conducts analyses of institutions and social entrepreneurship, the chapters of this research provide further evidence regarding the importance of formal and informal institutions in increasing social entrepreneurial activity driven by environment, and social entrepreneur satisfaction. At the same time, the influences are statistically significant and positive as alternative measures of social development and economic growth. Hence, having a clear idea about the institutional framework for social entrepreneurship may have a positive effect on the governments, scholars and entrepreneurs connected to these projects. On the other hand, from the perspective of entrepreneurial attention, the increase in new social ventures and support programs for

24 these projects has demonstrated the dynamism of this activity. However, little is still known about the limitations faced by social entrepreneurs during their entrepreneurial process.

Finally, social entrepreneurial ventures have the aim of modifying the status quo of society by making changes via social innovation or creating social benefit activities (Berbegal-Mirabent, et al., 2019). Hence, this type of entrepreneurial action in the society is appreciated, and nations should be interested in reinforcing its presence. This thesis helps to identify the main institutional barriers or limitations that social entrepreneurs face. Moreover, the study of this phenomenon in different countries at different levels of development (developing and developed countries) could be useful to understand the growth in the rate of social entrepreneurship.