Ethics & Enterprise: An Examination of Different Normative Theories of the Firm

Acknowledgments First and foremost, I would like to thank Rob Reich for his unconditional support as my advisor for the past year and a half. His insightful thoughts and constructive criticism have challenged me to develop my arguments more fully and with his recent and well-deserved tenure, I'm sure that he will continue to have a positive and meaningful influence in many students' lives as he has had in mine. I would also like to thank Joan Berry, the coordinator of the Ethics in Society Program, for our many conversations and emails and for giving the Ethics in Society Program a personal touch and a sense of community. I am also grateful to Jim Phills, who has been an understanding and accommodating second reader. I feel privileged to have met Michelle Shane and Neil Mukhopadhyay, my fellow Ethics in Society colleagues, who have been charming and wonderful friends and inspirational colleagues to work and take classes with. And finally, I would like to thank my parents for their moral and financial support, despite my decision to not be an engineer, and the many individuals at Stanford who have supported me in my education and growth as a person. Preface In my first year at Stanford, I quickly learned of a new movement in social change called social entrepreneurship. The idea that individuals could apply business concepts to address social issues was a very compelling and intuitive idea; after hearing the stories of social entrepreneurs, I too wanted to be a social entrepreneur and make a difference in the world. However, in my desires to become a social entrepreneur and tell others about social entrepreneurship, I had difficulty in articulating what social entrepreneurship was all about and why, from a theoretical perspective, social enterprises improved society. Microfinance, fair trade, socially responsible investing, and other buzz words of the social entrepreneurship movement seemed to hold of a lot of promise, but seemed devoid of any theoretical content. Looking for a way to combine my passion in social entrepreneurship and my academic and intellectual interests as a student, I soon began the journey of writing an honors thesis, with the intent of formally showing how social entrepreneurship improves society. What I soon realized though is that social entrepreneurship, while containing a lot of intuitive appeal, was poorly defined from a theoretical perspective. In the context of neoclassical and nonprofit theory, both of which …