Profit with Purpose? A Theory of Social Enterprise
Timothy Besley () and
Maitreesh Ghatak ()
American Economic Journal: Economic Policy, 2017, vol. 9, issue 3, 19-58
When social benefits cannot be measured, an organization that selects managers based on pro-social motivation can be used to balance profits with a social purpose. This paper develops a model of social enterprise based on selection of citizen-managers to run firms with flexible missions. We analyze organizational choice between social enterprise, for-profits, and nonprofits. The paper also develops the implications of matching between founders and managers based on their preferences for the mission.
JEL-codes: D21 L21 L31 (search for similar items in EconPapers)
Note: DOI: 10.1257/pol.20150495
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Persistent link: https://EconPapers.repec.org/RePEc:aea:aejpol:v:9:y:2017:i:3:p:19-58
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