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RESEARCH PRODUCT

Is social entrepreneurship a greenfield for foreign direct investment? A conceptual and empirical analysis

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Building on legitimacy and social strategy theories, this research proposes a conceptual and empirical framework that links social entrepreneurial activity (SEA) with foreign direct investment (FDI). Investing in foreign countries with a high degree of SEA contributes to increasing foreign investors’ legitimacy. Additionally, firms may consider SEA as a constituent of their social strategy. A key contribution of this study is the comprehensive conceptual framework used to analyze the link between social entrepreneurship and international business. The second key contribution is the econometric analysis of SEA's effect on greenfield FDI, foreign employment, and foreign projects. The estimation results of the gravity equation suggest that social entrepreneurship fosters FDI. This research offers theoretical insight on legitimacy theory's relevance in explaining the link between FDI and SEA. Copyright © 2015 ASAC. Published by John Wiley & Sons, Ltd. Resume En s'appuyant sur la theorie de la legitimite et la theorie de la strategie sociale, cet article propose un cadre conceptuel et empirique qui lie l'activite d'entrepreneuriat sociale (SEA) a l'investissement etranger direct (FDI). Investir dans les pays etrangers ayant un haut niveau de SEA contribue a augmenter la legitimite des investisseurs etrangers. Par ailleurs, les firmes considerent la SEA comme un element constitutif de leur strategie sociale. L'une des principales contributions de cette etude est le cadre conceptuel detaille utilise pour analyser la relation entre l'entrepreneuriat social et le commerce international. La deuxieme contribution principale est l'analyse econometrique de l'effet de la SEA sur les FDI en installations nouvelles, l'emploi etranger et les projets etrangers. Les resultats des estimations de l'equation de gravite suggerent que l'entrepreneuriat social favorise les FDI. L'etude offre un eclairage theorique sur la capacite de la theorie de la legitimite a expliquer la relation entre le FDI et la SEA.