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Performance Evaluation of Sheltered Workshops. Does Legal Status Matter?

Author

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  • María-Celia López-Penabad

    (Department of Financial Economics and Accounting, Faculty of Economics and Business Administration, USC, 15782 Santiago de Compostela, Spain)

  • José Manuel Maside-Sanfiz

    (Department of Financial Economics and Accounting, Faculty of Economics and Business Administration, USC, 15782 Santiago de Compostela, Spain)

  • Juan Torrelles-Manent

    (Faculty of Economics and Business Administration, University of Santiago de Compostela, 15782 Santiago de Compostela, Spain)

  • Carmen López-Andión

    (Department of Quantitative Economics, Faculty of Economics and Business Administration, USC, 15782 Santiago de Compostela, Spain)

Abstract

Social enterprise pursues both social and economic goals and is recognized as a formula for achieving sustainable development. Sheltered workshops (SWs) are a manifestation of this phenomenon, their main objective being the labor market integration of disabled people. In this paper, the efficiency of SWs has been studied taking into account the operational and the core social aspects, as well as their distinct nature, namely for-profit or non-profit status. Additionally, we have analyzed the relationship between the social efficiency and the economic returns of these entities. To do this, a semiparametric methodology, combining different data envelopment analysis (DEA) models with truncated regression estimation has been used. It is the non-profit and top-performing SWs that achieve the best social and economic efficiency. For-profit and low-performing SWs show further reductions in social efficiency as a result of the economic crisis and uncertainty in subsidy-related public policies. Their extensive social proactiveness and high economic strength in the crisis period positively influenced their social and economic efficiency. We have also proven that it is the most profitable SWs that have the greatest social efficiency. We consider that our results constitute a useful complement to other evaluation models for social enterprise.

Suggested Citation

  • María-Celia López-Penabad & José Manuel Maside-Sanfiz & Juan Torrelles-Manent & Carmen López-Andión, 2021. "Performance Evaluation of Sheltered Workshops. Does Legal Status Matter?," Sustainability, MDPI, vol. 13(3), pages 1-18, January.
    • Handle: RePEc:gam:jsusta:v:13:y:2021:i:3:p:1100-:d:484567
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    References listed on IDEAS

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    1. So Young Sohn & Yonghan Ju, 2023. "Mission Efficiency Analysis of For-Profit Microfinance Institutions with Categorical Output Variables," Sustainability, MDPI, vol. 15(3), pages 1-12, February.

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