Social entrepreneurship opportunities in China: a critical realist analysis

Social entrepreneurship (SE) has become a rapidly advancing domain of enquiry and holds a place in policy makers consideration around the globe. Opportunities have been regarded as critical in SE, but are often portrayed in abstract and unspecified ways. Research on this topic remains relatively scarce, theory building is not yet established and integrated, and the dearth of empirical studies further constrains theoretical development in SE. Researchers have thus called for more exploration and a comprehensive theoretical understanding of SE opportunities. The purpose of this study is to explore SE opportunities through empirical investigation and theoretical development. As an exploratory study, this study addresses two broad research questions: (1) What are SE opportunities? And (2) How do they emerge? To answer these questions, I draw on the broader entrepreneurship literature which provides two main alternative explanations: opportunity discovery (nexus theory) and opportunity creation (effectuation theory). While the discovery/creation debate is still ongoing, recent theoretical advancement has shown a possible path of forwarding entrepreneurial opportunity research, suggesting that research should incorporate structure and agency simultaneously in studying opportunities. Following this path, this study contributes to SE opportunity research by providing a comprehensive understanding of SE opportunities, it also helps address the discovery/creation debate in the context of SE. To make this contribution, this study first adopts critical realism as a research philosophy as well as methodology. Critical realism incorporates the effects of both structure and agency through its ontological assumptions of three domains of reality, while providing an explanatory framework to assess competing theories. Second, this study selects China as a context for empirical study. As a relation-oriented society, China provides a useful context for studying the causal relations between the social structure (guanxi) and SE opportunity. China s institutional context and fast growing social enterprise sector also provides a promising setting for exploratory research on SE opportunities. Based on critical realism, I used a three-step qualitative multi-case study to develop an explanatory framework in which guanxi and social capital theory provide theoretical explanations of the social structure and its causal powers, which lead to SE opportunity emergence in China. Data were collected from 45 interviews with Chinese social entrepreneurs, their employees and other key stakeholders in 36 organisations in Beijing, Hunan Province and Shanghai. My research findings show that SE opportunities develop in all of the three domains defined by critical realism. In the domain of empirical a world of human experience of social events a SE opportunity can be described as discovered, created, or as both discovered and created. In the domain of actual the social events under study a SE opportunity consists of three internal and necessary constituents: unjust social equilibrium (USE), social entrepreneurs beliefs (SEB), and social feasibility (SF). In the domain of real deeper structures, causal powers and mechanism that produce the social event the emergence of SE opportunities can be seen as the result of a resource acquisition and mobilisation mechanism whereby USE, SEB and SF are identified or formed through social entrepreneurs social capital embedded in guanxi. Building on these findings, this study concludes with a theoretical framework that offers a comprehensive explanation of SE opportunity emergence in China. This study is the first attempt to apply critical realism to the study of opportunities in the context of SE in China. It contributes to the SE and general entrepreneurship literature by developing a theoretical framework of SE opportunity emergence that provides an alternative explanation for the existence of discovery and creation opportunities, and by extending our theoretical understandings of some key concepts of SE. This research further provides an example of the use of qualitative methods to apply critical realism in SE and general entrepreneurship research, which contributes to the development of relatively rigorous research design and research methods in studying complex social events

Understanding Opportunities in Social Entrepreneurship: A Critical Realist Abstraction

The file attached to this record is the author's final peer reviewed version. The Publisher's final version can be found by following the DOI link.This paper extends social entrepreneurship (SE) research by drawing upon a critical realist perspective to analyse dynamic structure/agency relations in SE opportunity emergence, illustrated by empirical evidence. Our findings demonstrate an agential aspect (opportunity actualisation following a path-dependent seeding-growing-shaping process) and a structural aspect (institutional, cognitive and embedded structures necessary for SE opportunity emergence) related to SE opportunities. These structures provide three boundary conditions for SE agency: institutional discrimination, an SE belief system and social feasibility. Within this paper, we develop a novel theoretical framework to analyse SE opportunities plus, an applicable tool to advance related empirical research

The influence of family firms on the sustainability of start-up/nascent enterprises

The influence of family firms on the sustainability of start-up/nascent enterprise

The influence of family firms on the sustainability of start-up/nascent enterprises: a decision-making perspective

We examine the influence of family and family businesses on the sustainability of start-up/nascent enterprises set up by family members. Family firms can expand by setting up new enterprises so that their offspring or siblings can start their own business. This has many advantages for the established and for the new firms. For the established firms funds provided for the start-up can be ring-fenced so the established firm can grow with reduced risk. It also provides family firms with a means of training the younger generation before they take over the whole family business. Sustainability for the start-up can come from the provision of additional resources that they often lack such as additional funding, access to a network of stakeholders such as a skilled workforce, customers, suppliers, and management expertise. However, there may be some disadvantage for the fledgling firm with this arrangement if there is conflict in the decision-making process between a dominant family firm founder and the new CEO of the fledgling business. This raises interesting questions about how decision-making in the start-up/nascent firm will be affected by the family firm and how this in turn affects its sustainability in the longer term

The influence of family firms on the sustainability of start-up/nascent enterprises

The article examines the influence of family and family businesses on the sustainability (ability to become self-sufficient after initial input from family) of seven start-up/nascent enterprises set up by family members. Family firms can expand by setting up new enterprises so that their offspring or siblings can start their own business and can experiment with novel products or processes. This has many advantages for the established and for the new firms and for society as a whole. For the established firms the funds provided for the start-up can be ring-fenced so the established firm can effectively expand with reduced risk. It also provides family firms with a means of training the younger generation, a form of apprenticeship, before they take over the whole business from the incumbent generation. For new firms it can provide sustainability that would otherwise not be easy. For society family firms can be regarded as the seedbed of larger firms that can add to GDP, generate income tax and employment. Sustainability can come from the provision of additional resources that start-ups/nascent firms often lack such as additional funding, access to its networks of stakeholders such as a skilled workforce, customers, and suppliers, and management expertise. However, there may be some disadvantage for the fledgling firm with this arrangement if there is conflict in the decision-making process between a dominant family firm founder and the new CEO of the fledgling business. Our findings show that family members are involved in the decision-making process of the fledgling firms, they provide not only finance and access to their networks but also advice and emotional support. Most combinations of parent/child have managerial/entrepreneurial mindsets and we propose this will enhance sustainability of new ventures as the parents are effectively performing due diligence on the proposed business ideas and picking the best. Sustainability can be diminished if parents do not understand the new venture and withhold funding. Another key influence on sustainability was timing, that is how close the child entrepreneur was to succeeding the family business. This manifested itself in the form of request to return to the family firms and imposed conditions in return for funding. Path dependence of the child entrepreneur, a child with a managerial mindset, an exclusive reliance on parental networks, no additional team members or partners, or a very dominant child personality could have a negative influence on sustainability. We contribute to the literature on family firms and entrepreneurship and in particular to the little explored area of how family firm foster the creation of new companies

Methodological implications of critical realism for entrepreneurship research

Few papers have offered clear guidance for the application of critical realism (CR) to empirical studies, particularly in the research field of entrepreneurship. The purpose of this paper is to critically review how the methodological principles used to conduct CR-based research can be applied in empirical studies and to develop a critical realist case study research design to guide empirical work in entrepreneurship. I demonstrate the value of a CR-informed approach in empirical studies by drawing on a qualitative case study that explains the reality of entrepreneurial opportunities. My inclusion of the three domains of reality and various data analysis techniques within the process of conceptual abstraction and retroduction contributes a distinctive methodological development in this field, which illustrates how CR can work in an applied setting to explain competing theories. Such a research design enables us to conduct empirical studies and provide comprehensive causal explanations of complex social events.<br/

The causal mechanisms of social capital in social entrepreneurship

Social entrepreneurship is a multilevel phenomenon emerging from dynamic interactions between agency and structures at institutional, individual and community levels. Social entrepreneurs must bridge gaps between different individuals, organisations, industries, societal sectors through networking. However, little effort has been made to develop theories to explain how social networks/capital work and little empirical evidence has been provided. This paper aims to close this gap by developing a critical realist analysis of the role of social capital in social entrepreneurship. We draw on social capital theory and critical realism and propose that social capital is the inherent causal power embedded in social networks. As a causal power, social capital may or may not be actualised and, when actualised, it enables entrepreneurial actions to create social value. Through a multiple-case study that involves 45 semi-structured interviews, we identify three mechanisms – sparking, manifesting and scaling – through which social entrepreneurs use their social capital to obtain information, knowledge, market access, business resources, power and influence. These mechanisms enable entrepreneurial actions to create social and economic value. This paper develops our understanding of SE as a multi-level phenomenon by analysing the relations between individual networks and social capital, organisational resources and social sector market. It also extends social capital theory by exploring social capital in SE and highlighting its enabling effects on entrepreneurial actions.