Supporting social enterprises in Mexico : a prioritisation model and an institutional and public policy analysis of effective government grant allocation

Abstract

Social enterprises are gaining relevance in a world where alternative and innovative solutions are needed to tackle social problems. Social enterprises can be understood as organisations, that regardless of the legal form and business model adopted, offer a product or a service to create, not only economic but also social value, at different levels.Governments play a key role in the promotion and development of social enterprises, but to what extent are governments effectively fulfilling that role? This research focuses on the Mexican government organisations that have supported social enterprises between 2015 and 2017. The leading research question reads as follows: to what extent does the Mexican government effectively support social enterprises, especially ones that are new or recently created?This research, first, identifies the theoretically essential characteristics of social enterprises to set the basis for a model that can prioritise these enterprises and that could help governments in making a proper selection. This model is called the Prioritisation Model for [Social] Enterprises (PRIME). Second, this research also identifies the tools that governments can use to support social enterprises and what supports or restricts their implementation. These tools are referred as policy instruments and governments can use a wide variety of them to support social enterprises. Policy instruments could be affected by institutional environment elements (i.e., the regulative element, the normative element and the cultural-cognitive element) and by individual characteristics of actors involved in the process (i.e., motivation, cognition and resources). Finally, this research concludes that, although the Mexican government greatly supported social enterprises between 2015 and 2017, PRIME identified enterprises that should not be considered as social enterprises and, yet, they were supported by the Mexican government. The analysis of the institutional environment elements and the individual characteristics revealed obstacles that prevented a proper process of implementation. For example, a lack of adequate interaction between the government and the target group, or the fact that applicants were more concerned to meet informal, rather than the formal requirements.