The Singularity of Social Entrepreneurship: Untangling its Uniqueness and Market Function

Social entrepreneurship is an activity that is receiving intense scrutiny from scholars, practitioners and policymakers. However, research is only beginning to explore the unique function social entrepreneurs fill in the marketplace. This conceptual article examines if social entrepreneurs indeed represent a novel category of market actor. Building on prior work claiming that the unique function of social entrepreneurs is the creation of positive externalities and generation of spillover benefits for society, we compare social entrepreneurs with conventional entrepreneurs and other entities that seek to increase social welfare, including governments and traditional nonprofit organisations. Specifically, we contend that the strengths of social entrepreneurship are its reliance on voluntary exchange, promotion of dignity and self-sufficiency in beneficiaries, attunement to the signals of the marketplace and ability to tap into consumer spending. We also uncover the limitations of social entrepreneurship, which include the challenge of combining multiple institutional logics, the existence of social issues around which viable businesses cannot be built, dependence on consumer demand and competitive disadvantages relative to conventional businesses. We discuss the implications of our conceptualisation of social entrepreneurship for practitioners, policymakers and future research.