Government-driven social enterprises in South Korea: lessons from the Social Enterprise Promotion Program in the Seoul Metropolitan Government

Abstract

Although scholars and practitioners in the field of public administration have investigated the nature of social enterprises emerging from the nonprofit sector, little research has been undertaken on the role of governments in facilitating prospective social enterprises to transform nonprofits into social enterprises. This research explores the global phenomenon of social entrepreneurship by analysing the government-driven social enterprise programs in South Korea. What is the government-driven social enterprise policy in South Korea? What is the role of the government in driving the success of the social enterprises in South Korea? What are the factors that affect the success of government-driven social enterprises? The results of this study highlight how government support helps nonprofit organizations cope effectively with diverse constraints that may cause nonprofit failure in societies like South Korea. The study findings confirm that Salamon's third-party government perspective and nonprofit failure theory justify government intervention, suggesting that governments may drive nonprofit organizations efficiently to overcome a propensity to failure by providing them with resources. Points for practitioners This study found that government support to the small nonprofit organizations may facilitate civil society growth in Eastern Asia countries. Our research of government-driven social enterprise policy in Seoul Korea will provide a policy model for policy decision-makers for program design that would expand social services provided by non-state actors, and government-driven nonprofit policies will allow public agencies to direct and expand the social services without creating new agencies. However, we also found that the mandatory administrative approach may not address nonprofits’ daily challenges in an effective manner.