The commons: A model for understanding collective action and entrepreneurship in communities

The creation of commons—resources that are shared, accessible, and collectively owned and managed by communities—is increasingly being adopted by social entrepreneurs as a way of contributing to community development and putting value into economic activities. Yet, little research is evident related to the entrepreneurial processes involved in the creation and commercialization of these shared resources. Drawing on the Institutional Analysis and Development framework developed by Ostrom (2005), I explain how commons are entrepreneurially created. Based on a comparative study of five community banks in Brazil, I derive two ideological principles of collective entrepreneurship that help sustain commercialization of commons without commodification, namely ‘self-organization’ and ‘right to access’. I elucidate how these principles are enacted across venture levels through downward and upward mechanisms of social control facilitated by entrepreneurs who enhance collective action. This article contributes to the entrepreneurship theory of commons by explaining how commons are entrepreneurially created and by adding the collective entrepreneurship principles and mechanisms that commons of different types need in order to achieve and sustain wealth-creation options without incurring the downsides of commodification.