A Time and a Place: Non-Profit Engagement in the Creation of Markets and Industry Emergence

45 Pages Posted: 17 Oct 2017

See all articles by Sonali Shah

Sonali Shah

University of Illinois at Urbana-Champaign

Rajshree Agarwal

University of Maryland - Robert H. Smith School of Business

Steven T. Sonka

University of Illinois at Urbana-Champaign

Date Written: October 13, 2017

Abstract

This paper sheds light on how non-profit organizations can aid economic development by supporting the emergence of markets and industries in developing country contexts. We qualitatively examine archival data on the development of two industries: grain-storage metal silos in Central America during the late 1900s where nonprofits “seeded” new firms, and mobile money in Africa during the early 2000s where non-profits “transplanted” an established firm into Africa. Our comparison of these cases reveals two key findings. We find that either non-profits or firms can accomplish some activities, while other activities are undertaken only by non-profits. We also find that both nonprofits and firms circumvent institutional voids–that is they devise solutions that allow the focal industry to function while not necessarily providing a solution for the economy as a whole. We highlight opportunities for integrating institutional theory, organizational economics, and theories of industry and technology evolution to better understand how nonprofits and firms can work together to develop industries in underserved regions that have traditionally lacked strong institutions.

Keywords: Industry Evolution; Developing Economies; Social Entrepreneurship

JEL Classification: L3, 01, 03

Suggested Citation

Shah, Sonali and Agarwal, Rajshree and Sonka, Steven T., A Time and a Place: Non-Profit Engagement in the Creation of Markets and Industry Emergence (October 13, 2017). Available at SSRN: https://ssrn.com/abstract=2959714 or http://dx.doi.org/10.2139/ssrn.2959714

Sonali Shah

University of Illinois at Urbana-Champaign ( email )

Wohlers Hall
1206 South Sixth Street
Champaign, IL 61822
United States

Rajshree Agarwal (Contact Author)

University of Maryland - Robert H. Smith School of Business ( email )

College Park, MD 20742-1815
United States

Steven T. Sonka

University of Illinois at Urbana-Champaign ( email )

Champaign, IL 61820
United States

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