The Institutions of Livelihood and Social Enterprise Systems

Abstract

This paper considers resource coordination as a problem of allocation and distribution of resources in organisations pursuing social aims, or social enterprises (SEs). These goals are close to the Polanyian idea of the primacy of society over self-regulating markets and to reciprocity as mechanism of coordination of the economic activity that is different from both market exchange and redistribution. We ask what the specificities of organisations that pursue social aims are, and what coordination mechanisms underpin their production. The premise is that individuals are driven by plural motivations, including pro-social motivations besides self-interested ones, thus requiring a plurality of coordination mechanisms. SEs make principal use of cooperative pacts based on norms of reciprocity, but include also market exchanges and state-led coordination, both at organisational and systemic levels. Specific institutional solutions in support of cooperation and reciprocity, including asset distribution, surplus accumulation, redistribution, and multi-stakeholding are considered.

Keywords:

• Social enterprise
• Polanyi
• resource coordination
• reciprocity
• multi-stakeholding
• deliberation

JEL CODES:

• B55
• L31
• L33
• M14
• Z13

Notes

1 “Social history in the nineteenth century was thus the result of a double movement: the extension of the market organization in respect to genuine commodities was accompanied by its restriction in respect to fictitious ones. While on the one hand markets spread all over the face of the globe …, on the other hand a network of measures and policies was integrated into powerful institutions designed to check the action of the market relative to labour, land, and money … Society protected itself against the perils in a self-regulating market system …” (Polanyi, 1944, p. 76)